Sutter Health Alliance

“Significant bylaw changes former: the board of directors consisted of 2 ex officio directors, 1 designated director, and appointed directors. Revised: the board of directors consists of up to 3 designated directors and appointed directors. Form 990, part vi, lines 6 & 7a classes of persons and the nature of their rights: this corporation is an affiliate of sutter health, a california nonprofit public benefit corporation. Sutter health is the sole member with the right to elect at least a majority of the members of the board of directors.”

“Classes of persons, decisions requiring approval & type of voting rights: sutter health as the sole member of the organization is entitled to exercise fully all rights and privileges of members of nonprofit corporations under the california nonprofit public benefit corporation law, and all other applicable laws. The member has the rights and powers to appoint (and remove) members of the corporation's board of directors, subject to the provisions of the bylaws. In addition, the member has the right to approve the following actions of the corporation's board of directors: a. Merger, consolidation, reorganization, or dissolution of the corporation or any subsidiary or affiliate entity; b. Amendment or restatement of the articles of incorporation or the bylaws of the corporation or any subsidiary or affiliate entity; c. Adoption of operating budgets of the corporation or any subsidiary or affiliate entity, including consolidated or combined budgets of the corporation and all subsidiary organizations of the corporation; d. Adoption of capital budgets of the corporation or any subsidiary or affiliate entity; e. Aggregate operating or capital expenditures on an annual basis that exceed approved operating or capital budgets by a specified dollar amount to be determined from time to time by the general member; f. Long-term or material agreements of the corporation or any subsidiary or affiliate entity including but not limited to, borrowings, equity financings, capitalized leases and installment contracts; and purchase, sale, lease, disposition, hypothecation, exchange, gift, pledge or encumbrance of any asset, real or personal, with a fair market value in excess of a dollar amount to be determined from time to time by the directors of the general member, which shall not be less than 10% of the total annual routine capital budget of the corporation or any subsidiary or affiliate entity; g. Appointment of an independent auditor and hiring of independent counsel except in conflict situations between the general member and the corporation or any subsidiary or affiliate entity. H. The creation or acquisition of any subsidiary or affiliate entity; i. Contracting with any third party for all or substantially all of the management of the assets or operations of the corporation or any subsidiary or affiliate entity. J. Approval of major new programs and clinical services of the corporation or any subsidiary or affiliate entity. The general member shall from time to time define the term "major" in this context; k. Approval of strategic plans of the corporation or any subsidiary or affiliate entity; l. Adoption of quality improvement policies not in conformity with policies established by the general member; m. Any self dealing transaction between a director of the corporation and the corporation or a subsidiary or the corporation or affiliate entity of the corporation; n. Rehiring, contracting with, or otherwise compensating a sutter health executive, or any officer or member of management of the corporation or any subsidiary or affiliate entity after their employment ended. In addition, the general member shall have the authority to require the prior review and approval of those activities of the corporation or any subsidiary or affiliate entity which the general member determines to be major activities. "major activities" shall be those which the general member by a vote of its board of directors has declared "major activities".”

“Process used by management &/or governing body to review form 990: sutter health has a centralized tax department responsible for the preparation of the form 990. Annually the tax department provides training and education to affiliate personnel who assist the tax department in collecting and reviewing data to be reported on the form 990. The preparation material is reviewed by various departments including tax, finance, legal, and human resources. A national accounting firm prepares and/or reviews the return. A completed return is then reviewed by the tax department, the affiliate, and the cfo before the return is filed.”

“Process to monitor transactions for conflicts of interest: employees are educated on the conflict of interest policy and the need to make disclosure as part of annual compliance education. In addition, annually a disclosure statement is completed by all directors, officers and key employees. On this statement the individual will list a wide range of information which includes business relationships, employment relationships, property interests, and those of related parties. If there is a potential conflict of interest related to a particular transaction, the interested individual must disclose the existence and nature of the relationship. The board chair may appoint a disinterested person or committee to investigate the conflict. The board may consult with the office of the general counsel as necessary. Until the potential conflict is resolved, the board chair (or committee chair as applicable) may request the individual to not participate during related presentations and discussions. In all circumstances involving an actual conflict, the interested individual shall leave the room prior to the boards final discussion and vote.”

“Process for determining compensation: the compensation committee of the sutter health board of directors retains ultimate discretionary authority over all elements of compensation to assure that organizational purposes are appropriately being served. The compensation committee uses credible data sources and maintains an objective "arms length" decision-making process, ensuring the integrity of sutters executive programs and consistency with the organizations overall mission. In order to ensure external competitiveness, national, california and local market area compensation data comparisons are reviewed. Competitive analysis includes: (a) base salary, (b) total cash (base salary + annual incentive), (c) total direct cash (base salary + annual incentive + long term incentive) and (d) total remuneration (base salary + annual incentive + benefits and long term incentive). This analysis includes comparable organizations and geographic considerations. For the most senior executive positions, national comparisons for organizations similar in size, scope and complexity as sutter health are most appropriate since it is a national marketplace in which sutter competes for executive talent. On the other hand, because californias underlying compensation structure is higher than national data (especially in the bay area), regional pay adjustments may be made. Officers and key employees of this organization undergo a review and compensation committee approval annually, and such approval is recorded in the minutes. The 2018 executive compensation approval was completed in december 2017.”

“Availability of governing documents, coi policy & financial statements: the sutter health system posts its current and past audited financial statements at sutterhealth.org. Other documents are also located at this website including the annual report, mission statement, history, and links to affiliate websites. The governing documents are not available to the public at this time.”

“Compensation of board members: the following board members of the organization are full-time employees (40 hours per week) of sutter health and their sutter health salaries are reported herein. These individuals receive no compensation for their service as board members of this organization. - jeff gerard - sarah krevans - brian fellner - phil jackson individuals listed as officers and key employees of the organization that are paid fulltime by a related organization are common law employees of sutter health, a separate legal entity. It is the intention of sutter health and the filing organization to make information accessible and transparent, reporting those sutter health employees who have officer and key employee responsibilities to the filing organization.”

“Program service accomplishments: sutter health plan (doing business as sutter health plus) is an affiliate of the sutter health system, a comprehensive network of care spanning more than 20 counties across northern california. The sutter network includes nine physician organizations, two dozen acute care hospitals and a wide array of medical research facilities, training programs, care centers and specialty services. We believe that all people deserve access to excellent medical care - whoever they are and wherever they live. Sutter health doctors, hospitals and other caregivers partner with each other to advance our medical services and increase patients access to them. Sutter-affiliated hospitals are regional leaders in cardiac care, womens and childrens services, cancer care, orthopedics and advanced patient safety technology. The primary purpose of sutter health plus is to improve the health of the community by increasing access to sutter healths network of high-quality doctors, hospitals and other health care services. The health plan promotes affordability through the delivery of cost-effective health care services; this includes partnering with our provider network to improve quality and reduce costs. Sutter health plus is licensed by the department of managed health care as a knox-keene health maintenance organization with plan coverage beginning in january 2014. Sutter health plus members are assigned primary care providers exclusively with physicians through related sutter health tax-exempt medical foundations. Sutter health plus develops its plan products under a not-for-profit mission with a commitment to provide affordably priced hmo health plans in accordance with patient protection and affordable care act and federal guidelines that allow northern californias socially and economically diverse communities to access high quality and accessible care at sutter healths network of doctors and hospitals. Sutter health plus participates in activities designed to promote the general health of communities, promotes and encourage advancement and improvement of high-quality and cost-effective health care services; and facilitates the interchange of ideas among health care service organizations and communities served. Additionally, sutter health plus: - participates in and supports the community benefit efforts of sutter healths affiliated hospitals and doctors in the sacramento and central valley areas, including increasing access to health education and child access to care and activities; - participates in new care models that promote and encourage the advancement and improvement of high quality and cost-effective care services; - facilitates the interchange of ideas among provider organizations and the communities served through education activities and advances the planning for and delivery of high quality health care services in the communities served; - engages in, conducts or supports charitable, educational or scientific activities, and to further such activities as may be deemed advisable for the advancement of health care; - promotes or carries on such other activities as may be deemed advisable for the betterment of the general health of the communities served. Sutter health plus participates in activities designed to promote the general health of communities; promotes and encourages advancement and improvement of high-quality and cost-effective health care services; and facilitates the interchange of ideas among health care service organizations and communities served.”

“Other changes in fund balance: equity transfers: $7,868,274”