Halifax Regional Development Foundation Inc.

“The organization's officers and directors served together on the boards of other organizations within the sentara healthcare system ("the system"), as well as joint ventures in which the system had an ownership interest. See schedule r for a listing of such entities.”

“The organization's sole member was halifax regional hospital, inc., a virginia nonstock corporation and section 501(c)(3) tax exempt entity.”

“The board of directors, which served as the organization's governing body, was elected by the organization's sole member, halifax regional hospital, inc., a virginia non-stock corporation and section 501(c)(3) tax exempt entity. The election was subject to ratification by sentara healthcare, a virginia non-stock corporation and the section 501(c)(3) tax exempt parent of the sentara health system.”

“Sentara healthcare ("sentara"), a virginia nonstock corporation and the 501(c)(3) tax exempt parent of the sentara health system, in its capacity as the sole member of halifax regional hospital, inc. ("hrh"), a virginia nonstock corporation which is a 501(c)(3) tax exempt entity and sole member of the organization, has reserved the exclusive right, power and authority to make decisions for and on behalf of the organization with respect to the approval or adoption of any plan of merger or consolidation; any sale, lease, exchange, mortgage, pledge or other disposition of all, or substantially all, the property and assets of the organization; and the voluntary dissolution or liquidation of the organization, revocation of any such voluntary dissolution proceedings, or any decision to file a petition requesting or consenting to an order for relief under the federal bankruptcy laws or similar state laws for the organization. Election of the organization's governing body is also subject to ratification by sentara. Finally, special approval by hrh's governing body is required for certain other actions of the organization. These include a change in the organization's mission; the establishment of, and appointment of members to, any committees which will have any of the authority of the hrh governing body; and any alteration, amendment, restatement or repeal of any governing documents, the adoption of any new governing documents; or any action to be taken as the member under the governing documents. Final authority for the establishment of all policy pertaining to the organization for its operation, maintenance and development, and for the attainment of its objectives, is vested in the governing body of hrh, and subject to ratification and approval by sentara.”

“The organization was part of the sentara health system ("the system"), and as such, used the system's in-house tax department, headed by a licensed certified public accountant, to both prepare and review its form 990. During the preparation and review process, the tax department worked closely with other system departments, such as legal, compensation and benefits, compliance, finance, and marketing, to ensure that a complete and accurate return was filed. The parent of the system is sentara healthcare, a virginia nonstock corporation and 501(c)(3) tax exempt entity.”

“Directors, board-nominated officers, and key employees are requested to submit an annual conflict of interest questionnaire and certify to the completion and accuracy of the information disclosed. Additionally, each organization's governing board or appropriate body monitors transactions involving disclosed potential conflicts of interest.”

“As part of the sentara health system ("the system"), the organization followed processes and procedures set forth in its governing documents to ensure compliance with its obligations as a 501(c)(3) healthcare organization to pay disqualified persons reasonable compensation. Such processes and procedures are intended to establish the rebuttable presumption of reasonableness under the internal revenue code section 4958 regulations. The compensation philosophy of the system as a whole is to base overall compensation and benefits for executives on not-for-profit market comparables, adjusted as applied to each executive, taking into consideration the individual skills, experience, tenure and performance of the executive being compensated and overall performance of the organization. In line with this philosophy, the system performed substantial due diligence as to market comparables. The system's compensation committee, which consists of system board members without conflicts of interests, engaged an outside consultant, who reports to the compensation committee, to conduct a study assessing the competitiveness of total compensation (including cash compensation, benefits and perquisites) of its senior executives prior to making decisions regarding annual base salary adjustments, approving incentive awards, or considering programmatic changes. The study compared the compensation of the system's senior executives to compensation data from multiple published survey sources based on the senior executive's functional responsibility. In conducting the study, the consultant targeted other not-for-profit health systems of similar size based on net revenue and complexity. For health plan positions, health plans with similar premiums, or members, were targeted. The consultant also conducts a review of the organization's performance relative to a group of not-for-profit health systems of comparable size and scope of operations every year. The most recent study compared sentara's performance to 32 not-for-profit healthcare systems based on net revenue growth, operating margin, various clinical quality metrics and patient satisfaction. Overall, the consultant determined that sentara's pay was aligned with its relative performance. The compensation study was presented to the system's compensation committee, which made its compensation decisions based on a)its review and analysis of the performance of both the organization and its senior executives and, b) a reasonableness of compensation analysis and opinion from an external expert in the compensation of executives in the tax-exempt health care field. The committee's bases for its decisions were documented in committee minutes taken during the meeting and then circulated for review and approval. All decisions regarding compensation were made by the committee, which consists of system board members without conflict of interests. This process was used to establish compensation for the organization's treasurer, who also served as senior vice president of the system. The process was last undertaken during the current tax year. The outside market study described above was also used to establish compensation for the organization's president, who is considered the top management official of the organization. Results were presented to the president and ceo of the system for review and approval rather than the system's compensation committee.”

“The consolidated financial statements for sentara healthcare and subsidiaries were made publicly available through the use of dac bond (disclosure dissemination agent) and can be found on the internet at www.dacbond.com. The organization's governing documents and conflicts of interest policy are generally not made available to the public.”

“The organization's board of directors is appointed by halifax regional hospital, inc., a virginia nonstock corporation which is a 501(c)(3) tax exempt entity and sole member of the organization. Appointments are subject to ratification by sentara healthcare, a virginia nonstock corporation and the 501(c)(3) tax exempt parent of the sentara health system. The governing board of sentara healthcare is a community-based board comprised of 18 voting members, 17 of which are considered independent, as defined in the form 990 instructions.”

“Halifax regional development foundation, inc. Is organized and operated exclusively for the benefit of, to perform the functions of, or to carry out the purposes of halifax regional hospital, inc. The functions to be performed by the corporation are to solicit, receive, and administer gifts, grants, contributions and donations for halifax regional hospital, inc. Or provide such other services that are requested by halifax regional hospital, inc. And to carry out other exclusively charitable, educational and scientific purposes of halifax regional hospital, inc.”

“Sentara healthcare i. Sentara healthcare - your not-for-profit healthcare partner sentara healthcare based in norfolk, va, celebrates more than 130 years in relentless pursuit of its mission to improve health every day through innovation, compassion and community benefit. Sentara is a fully integrated not-for-profit system with nearly 300 sites of care of which there are 12 hospitals in virginia and north carolina, including a level i trauma center with nightingale regional air ambulance and the nationally-ranked sentara heart hospital. The sentara family includes four medical groups, ambulatory campuses, post-acute care services, the physician-led sentara quality care network, the accredited sentara cancer network, the sentara college of health sciences, optima health plan members in virginia and ohio, and a team of professionals nearly 28,000 strong. Sentara proudly includes advanced imaging centers, nursing and assisted living centers, physical therapy and rehabilitation services, home health and hospice, and ground medical transportation. Sentara is strategically focused on continuous improvement in quality, safety, clinical outcomes and the patient experience and pursues key clinical goals through high performance teams across the enterprise. Efforts are centered on providing the right care in the right setting at the right time and adding value to the communities we serve. We strive to serve all of our communities through health outreach programs, education, and financial support of other not for profit organizations with similar health missions. Ii. Commitment to the community a. Sentara healthcare and optima health provided $6.5m in donations. Donations were distributed to foodbanks, virginia association of free and charitable clinics, community care networks of virginia, and the virginia health care foundation. Part of the $6.5m went towards supporting the marketing by the commonwealth of virginia to make residents aware of the opportunity for health insurance through medicaid expansion. Additionally, donations were made to 17 health related projects across virginia and north carolina. We pledged $130m to eastern virginia medical school over 5 years. B. Sentara has provided much in the way of community benefit and charity care on an annual basis. In 2018, sentara community benefit reached nearly $390,000,000. Sentara provided $354,121.000 in net uncompensated patient care costs; $2,086,000 in net unfunded costs of teaching programs; and $33,768,000 in incurred costs for community benefit programs. C. Sentara is proud of the mission-driven work of the three sentara foundations. These foundations raised money to support the clinical needs of the system and provided funding through grants and direct contributions to community organizations that have similar interests in community health needs. Sentara foundation-hampton roads supports a wide range of programs across hampton roads. In 2018, the foundation raised $1.96m and awarded 30 community grants totaling $675,000 to support its key priority areas. The martha jefferson hospital foundation in charlottesville, virginia raised nearly $3.5m in new gifts and commitments and focused their efforts on a high-risk breast program, cancer survivorship program, family and caregiver support program and the center for clinical education. The rmh foundation raised $4.79m in new gifts and commitments and focused their efforts on the sentara rmh hahn cancer center linear accelerator. In 2018, the rmh foundation awarded 6 community partnership grants for a combined $79,897. This included $20,000 in seed funding to start the community's first ram "remote area medical" clinic. Several years ago, sentara established the hope (helping overcome personal emergency) fund, which is an emergency financial resource for sentara employees that are experiencing catastrophic hardship or loss through no fault of their own. Sentara employees who receive aid from the hope fund have faced devastating cr”

“C. Sentara, in partnership with others, expanded to 15 velocity urgent care centers across virginia. Across sites, 144,796 patient visits were seen with an average door in to door out time of 45 minutes. Iv. New initiatives a. Sentara continues to develop opportunities to enhance our behavioral health initiatives and implement programs that will support the communities we serve. The center for behavioral health located at sentara virginia beach general hospital began offering structured outpatient programs specifically designed to meet the needs of adults experiencing mental health and/or substance abuse problems. B. Sentara built the foundation for our new ambulatory/retail strategy by updating our growth imperative and structuring the organization to capture opportunities in this area. C. In its fourth year, clinical performance improvement (clinical pi), an initiative to drive change and create rapid process improvement in targeted clinical areas, resulted in seeing positive trends towards meeting the company's ultimate goals. D. The voice of the customer model was heavily utilized to understand more from sentara and optima customers. The model is an operational design that enables sentara to integrate the voice of the customer into all facets of business decision-making and product development. E. Sentara began communicating about the good we do for the communities we serve. We created and distributed two community benefit reports, complemented with fully integrated marketing campaigns and, also stepped up our philanthropic donations. F. A nutrition as medicine conference was held in november, 2018. National experts in plant-based lifestyles detailed the nutritional benefits of such diets in front of nearly 950 people. Guests included 350 medical professionals, and registrants traveled from 14 states and even canada to learn the positive effects nutrition can have on chronic illnesses and quality of life. G. Old dominion university is partnering with sentara healthcare on a three-year project to develop a blockchain-empowered cybersecurity solution to monitor network activities of mobile devices and provide real-time alerts of unauthorized devices or communications. V. Offering new procedures and technologies clinical breakthroughs and advancements: sentara introduced many new clinical breakthroughs and advancements that benefited the patient in many areas of care, including cardiac and reducing infections. A. Pharmacy robot: i. Sentara rmh medical center pharmacy installed a new state-of-the-art pharmacy robot for automated dispensing of patient medications. The hospital is the second in the world to install the omnicell xr2 automated central pharmacy system. B. Surgical imaging: i. Sentara norfolk general hospital introduced the imri. The ge intraoperative mri machine is an mri that is done mid-surgery to help neurosurgeons know if they have removed the entire lesion or tumor without having to wake the patient up. It provides real-time imaging during surgical procedures including brain tumors, glioma and movement disorders/tremors like parkinson's disease. Ii. The sentara heart transplant team is now using the sherpa pak tm transport system by paragonix technologies to ensure a consistent temperature at all times of a donor heart transport. The sherpa pak tm is a temperature controlled cooling system that allows the heart to be stored at a chosen temperature. Vi. Expanding educational opportunities sentara is committed to always improving--including encouraging registered nurses (rns) to continue pursuing educational opportunities. Continuous learning will advance the care sentara nurses deliver to our patients and allow them to advance in their careers. In 2018, sentara achieved its goal of 80% of sentara nurses having a bsn by 2020. In 2018, sentara had 64.5% of its nursing workforce holding a bsn or higher degree with 16.2% of licensed rns with a contract to complete their bsn. Research: research is another way sentar”

“Vii. Building for the future: a. The sentara belleharbour strategic plan was completed and sentara belleharbour, located in suffolk, opened a new 20,000 sq. Ft. Ambulatory surgery center where lower acuity surgeries such as podiatry, vascular access and hernia repair are conducted. B. To help travelers, sentara martha jefferson hospital, located in charlottesville, opened a travelers' clinic. This is a full-service clinic providing pre-travel, in-travel and post-travel services. Services will be provided to all age groups. C. Sentara norfolk general hospital, our level i trauma center, located in norfolk is home to the nightingale regional air ambulance, the region's premier air ambulance. In 2018, nine sites in eastern virginia and northeast north carolina are fully operational for instrument flight rules (ifr) landings by nightingale. The faa designation creates designated air space, allowing flights in cloudy, rainy weather, which had to be turned down under current visual flight rules (vfr) limitations. Ifr allows nightingale to meet ground ambulances at designated safe sites in poor weather rather than remote scenes. D. The sentara sports medicine center opened at the outpatient care center in charlottesville. The specialists providing care at the center have experience caring for athletes of all levels, from novice to olympian, and for such injuries as sprains and strains, torn ligaments and tendons, joint dislocations and fractures. Advanced techniques such as injections using platelet-rich plasma therapy, as well as other non-surgical and surgical procedures are also used to aid healing. E. Sentara northern virginia medical center, located in woodbridge, announced the addition of neurosurgery and unveiled its newly renovated and expanded sentara wound healing center. F. Sentara albemarle medical center, located in elizabeth city, north carolina, introduced the use of the endobronchial ultrasound (ebus) bronchoscopy. This will allow doctors to more easily locate tumors, lymph nodes, or other tissues of concern. Additionally, sentara albemarle medical center (samc) introduced the sentara wound healing center and the samc cancer center received accreditation from the commission on cancer. Samc introduced the brevera breast biopsy system. This breast biopsy system shortens the imaging delay between biopsies and it reduces biopsy times by an average of 10 minutes. G. Sentara virginia beach general hospital, located in virginia beach, launched its fracture center where it provides high quality, subspecialty care from a specialized team of orthopedic surgeons. Sentara virginia beach general hospital marked its completion of the first phase of its modernization project with the consolidation and re-styling of the hospital's three separate intensive care units into one state-of-the-art, 24-bed icu. H. Sentara halifax regional hospital, located in south boston, opened a behavioral health partial hospitalization program to join its existing intensive outpatient program in order to further enhance its behavioral health services for the community. I. Sentara leigh hospital, located in norfolk, sentara princess anne hospital, located in virginia beach, and sentara virginia beach general hospital, located in virginia beach, introduced their sentara foot and ankle centers. These centers have developed pathways for patients to receive the right care for the type of foot or ankle concern individuals may have. J. Sentara princess anne hospital, located in virginia beach, completed its modernization project resulting in the addition of two new floors to the hospital and the addition of 14 inpatient hospital beds and 10 observation beds; expanded monitoring for cardiac patients; inpatient dialysis center to treat patients with kidney failure; and allows for future expansion of surgical services. K. Sentara careplex hospital, located in hampton, experienced a strong first year of offering maternity services. The birthing center has 7 labor,”

“A. Award-winning care - as always, sentara is proud and humbled by the various awards and recognitions the system received over the course of the year. Our mission is to improve health every day. To receive an award is simply an added acknowledgement of our mission driven work. Here are a few of the 2018 awards and recognitions: i. For the 18th consecutive year, the cardiology and heart surgery program at sentara norfolk general hospital (sentara heart hospital) was listed among the top 50 heart programs in the u.s. News & world report 'best hospitals' ranking #32 in 2018. Sentara norfolk general hospital also earned two additional top 50 national rankings from u.s. News & world report: diabetes and endocrinology (ranked no. 31), a specialty at eastern virginia medical school, and nephrology (ranked 48). Ii. Seven sentara hospitals earned highest grade of "a" for delivering safe care for patients according to the leapfrog hospital safety score. Iii. Sentara norfolk general hospital epilepsy center has been accredited as a level iii epilepsy center through the national association of epilepsy centers. Iv. Sentara is the only health system on the east coast to be nationally recognized among the 15 top health systems by ibm watson health for 2018. The award demonstrates consistently excellent performance and a high rate of improvement across the entire organization. V. Sentara was pleased to have been recognized as one of america's best employers in 2018 by forbes. Ranking in the best large employers category, sentara is number 177 of 500 companies categorized into 25 industries. Sentara was named alongside only 24 other large organizations in the healthcare and social industry group. Vi. Sentara excelled in stroke certifications in 2018. Sentara norfolk general hospital, located in norfolk, achieved comprehensive stroke certification after a multi-year effort to do so and sentara martha jefferson hospital, located in charlottesville, received a first-ever primary stroke center plus certifications. Two free-standing emergency departments - sentara belleharbour and sentara independence - achieved an acute stroke ready certification. Vii. Sentara halifax regional hospital was named in the top 100 rural and community hospitals in the united states by ivantage health analytics and the chartis center for rural health. This is the second consecutive year that the hospital has received this designation. Viii. Sentara life care in virginia beach was recognized as a pathways of excellence center from the american nurses credentialing center. This designation recognizes an organization's commitment to creating a positive practice environment that empowers and engages staff. This is the first long-term care facility in virginia to be designated as a pathways to excellence center and only the fourth long term center nationally to have this designation. Ix. Optima health a. Growth optima health completed its optima growth and strategic capabilities plan. Additionally, optima health was selected as one of six managed care organizations to serve members through medicaid expansion, which will allow for nearly 400,000 virginians to now have access to quality health care. Medicaid expansion enrollment began november 1, 2018 with an effective date starting january 1, 2019. Optima expanded its network to include riverside health system facilities and providers, enabling for broader access to care for members. Conclusion: sentara healthcare is committed to improving health every day. We provide quality care through expert providers, using cutting-edge technology, deploying medical breakthroughs, and providing excellent customer service all with a constant focus on innovation. And, we are committed to supporting the communities we serve through employee volunteerism, grants, sponsorships, and supporting initiatives that lift our communities. We look forward to another year of community success, growth and innovation in 2019.”

“Reclass of intercompany accounts to equity 222,830.”