Sentara Enterprises and Subsidiary

“The organization's officers and directors served together on the boards of other organizations within the sentara health 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 sentara health, 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 its sole member, sentara health, a virginia nonstock corporation and the section 501(c)(3) tax exempt parent of the sentara health system.”

“As sole member, sentara health, a virginia nonstock corporation and the 501(c)(3) tax exempt parent of the sentara health system, is entitled to one vote on all matters and has the right to elect and remove members of the organization's governing body; approve any alteration, amendment or repeal of its governing documents; approve the annual operating and capital budget and all formal long-range plans; approve any single capital expenditure exceeding $1 million; approve all borrowing or indebtedness which in any one transaction or related series of transactions exceeds $500,000; approve 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, the voluntary dissolution of the organization, or revocation of voluntary dissolution proceedings; review the books and records, conduct audits, and approve the selection of auditors chosen to conduct audits of the organization; and approve the creation or acquisition of any subsidiary of the organization, or the creation of any other corporation of which the organization is to be a member, and to approve any dissolution or other change in any such legal relationship previously approved by sentara health.”

“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 health, 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 organization is to base overall compensation and benefits for executives on not-for-profit market comparables, 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 organization performed substantial due diligence as to market comparables. The compensation committee, which consists of independent board members without conflicts of interest, 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 organization's senior executives to compensation data from published survey sources based on each 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 every year. The most recent study compared sentara's performance to 28 not-for-profit healthcare systems, and 36 independent and integrated delivery system-owned health plans 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 organization'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 meetings and then circulated for review and approval. All decisions regarding compensation were made by the committee, which consists of independent board members without conflict of interests. This process was used to establish compensation for the organization's president, chairman, secretary, and treasurer. The chairman, secretary, and treasurer also served as president and coo, corporate vice president and clo, and executive vice president and cfo of the system, respectively. The process was last undertaken during the current tax year for the positions listed.”

“The consolidated financial statements for sentara health 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.”

“Sentara enterprises provides a wide range of services for recovering, disabled or chronically ill persons in need of skilled nursing, private duty nursing, rehabilitation services (i.e., physical therapy, occupational therapy and speech therapy), infusion services, or companion services. Sentara home care services also offers specialty programs in mental health, high-risk obstetrical care, high-risk newborn care, asthma, diabetes and pediatrics. All services are provided to the community regardless of race, creed, sex, national origin, handicap, age or ability to pay. The cost of uncompensated care provided by sentara enterprises to the community during 2022 was over $6 million.”

“During 2022, the organization sold its medical transport assets and no longer provides medical transport services.”

“Sentara health i. Sentara health your not-for-profit healthcare partner sentara health celebrates 134 years in pursuit of its mission "we improve health every day." sentara is an integrated, not-for-profit health care delivery system with more than 29,000 employees (including 1,375 physicians and advanced practice providers), 12 hospitals in virginia and northeastern north carolina and the sentara health plans division, which serves over 1,000,000 members in virginia, north carolina, and florida. Sentara is recognized nationally for clinical quality and safety and is strategically focused on innovation and creating an extraordinary health care experience for our patients and members. Sentara was recognized as a "best employer for new grads", "veterans and "america's best employer" by forbes in 2022. Sentara has a level i trauma center, the sentara heart hospital, the sentara health research center, the sentara brock cancer center, and the accredited sentara cancer network, two orthopedic hospitals, and the sentara neurosciences institute. Sentara also includes a medical group, nightingale regional air ambulance (made 863 life-saving trips in 2022 alone), home care, ambulatory outpatient campuses, advanced imaging and diagnostic centers, a clinically integrated network, and the sentara college of health sciences. 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 our communities through health outreach programs, education, and financial support for other not for profit organizations with similar health missions. As an integrated delivery network (idn), sentara provides both health care services (hospitals, clinics, providers) and health insurance plans, which enables sentara to fully understand and deliver on the needs of our consumers in a unique and insightful way. Additionally, serving as an idn provides us with the opportunity to impact and lift our communities given the comprehensive nature of our ability to deliver care and resources within the walls of our care sites as well as deep within the community. Ii. Commitment to the community sentara has provided much in the way of community benefit and charity care on an annual basis. The 2022 value of community benefit totaled $260.2 million. Sentara provided $157 million in net uncompensated patient care costs; $48.5 million in teaching & training of healthcare professionals; $48 million in community giving; and $6.7 million in health & prevention programs. Sentara employees contributed $1.9 million through direct contribution and employee matching to united ways in virginia and north carolina. A. Sentara continues its efforts through the community engagement and impact (cei) program, sentara cares, to inspire, empower and support the communities we serve in the most impactful way. Sentara awarded 86 grants totaling $8,609,557 for our communities as well as $1,069,683 in microgrants reaching the deepest levels in our communities. Sentara invested $3,850,300 for sentara scholars and sentara choice, which are programs to support students with a vision and pathway for success that includes support and removes barriers to higher paying, meaningful healthcare careers. Sentara donated nearly $3.5 million in medical supplies to support charities addressing humanitarian crises in ukraine, poland, haiti, and the philippines. The cei program delivers economic, social, and enviromental benefits for stakeholders across all sentara markets and increases our community connection. It builds on sentara recognized leadership and commitment to the communities we serve. B. In 2022, sentara launched sentara community care, a new model of care which includes sentara community care centers and sentara mobile care. Sentara opened the first sentara community care center at union mission (homeless shelter) in norfolk, virginia followed by a center in the berkley neighborhood of norfolk. Addition”

“J. Sentara continues to recognize the need for housing along the continuum to include supporting emergency, affordable and supportive housing services in connection with cities, community service boards and mental health providers across virginia. Sentara announced an $11m investment in the marshall-ridley choice neighborhood revitalization initiative in newport news, virginia. This project is part of the choice neighborhood initiative, which leverages public and private investments to replace distressed public housing and transform neighborhoods of concentrated poverty into neighborhoods of opportunity. In 2022, sentara funded a capital grant to judeo christian outreach center (jcoc) in support of an ambitious campus rebuild project that will dramatically increase our ability to lead people out of hunger and homelessness. The new 20,644 sq ft. Facility in virginia beach will create 38 single room occupancy (sro) affordable-housing units. All residents will have access to the support services provided by jcoc and our continuum of care partners. The complex will house our community dinner, food pantry and family food box programs, which serve more than 110,000 free meals worth of food a year including the distribution of meat and nonperishables to approximately 4,000 individuals annually. Sentara funded 32 organizations across virginia ranging from $10,000-$500,000 that support programs and projects who work in the area of distressed public housing, transforming neighborhoods of concentrated poverty into neighborhoods of opportunity. K. Community health initiatives sentara and sentara health plans, formerly known as optima health and virginia premier, have long been committed to providing health and prevention services to the communities we serve through many channels including the sentara health community health and prevention organization within sentara. Below are some key highlights of the efforts in our communities in 2022: sentara continued to offer programs such as eating for life, walkabout with healthy edge, health habits, healthy you, meditation, tai chi and yoga. Sentara hosts several community events raising awareness around key health awareness months. One good example is through the promotion of "28 days of heart" in february 2022 in support of heart health awareness. Online promotions, radio ads, videos, screenings, and more were conducted to raise awareness of heart disease throughout the communities we serve in virginia and north carolina. Additionally, sentara norfolk general hospital continued to utilize grant funding that supports community health workers to provide case management services for survivors of gun violence, assaults and stabbings admitted to the trauma service or discharged from the emergency department. The purpose of the program is to assist survivors of violence, assess their social determinants of health and, based on the results, develop an intervention. Iii. Commitment to our team members a. Sentara investing in our people is always a top priority and in line with our mission to improve health every day. In 2022 alone, sentara invested more than $125m in pay increases and enhanced benefits for our colleagues. The pay increases totaled $110m and $15m constituted enhanced or new benefits including - reimbursement programs to assist with adoption expenses; infertility care expenses and surrogacy and gestational carrier expenses; short term disability eligibility at 7 days; increased paid time off; paid parental leave; enhanced sick time eligibility; additional support for family caregiver; and increased educational assistance to support career advancement. B. Workplace safety for our sentara colleagues is paramount. We must keep our colleagues safe for them to be able to care for our members, patients, and the communities we serve. In the interest of employee, patient and visitor safety, sentara implemented a visitor badging system at our hospitals. Additionally, personal safety devices were”

“Vi. By the numbers: a. 786,063 emergency room visits; 16,036 babies delivered, 14 heart transplants, 66 kidney transplants, 2 pancreas transplants, 130 covid-19 vaccine clinics, 261,000 sentara lab covid-19 tests, 25,000 covid-19 boosters and flu vaccines by sentara employee health, 863 life-saving trips from the nightingale air ambulance, and 157,967 medical, behavioral and pregnancy cases managed through our health plans. Vii. Expanding educational and research opportunities a. Education: 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 2022, sentara reached 78.1% of sentara nurses having earned or are under contract to earn a bsn. Sentara had 71.6% of its nursing workforce holding a bsn or higher degree with 6.5% of licensed rns with a contract to complete their bsn. B. Research: research is another way sentara is always improving. In 2022, sentara experienced a 16.5% increase in clinical trials and 31.5% increase in principal investigators compared to 2021. The sentara health research center provides scientific, administrative, and regulatory support for research conducted across sentara health and in our communities. The sentara health research center strives to improve treatment options, medical technology, and health equities with our dedicated team of experts and state-of-the-art technology. Our research takes place inside and outside of the hospital. We also conduct research in our community and partner with many community practices. Our research helps to advance scientific understanding of diseases and advance knowledge that leads to better and more effective treatments that improve the health in our communities. Our areas of research include: cancer cardiovascular healthcare delivery and health equity internal medicine neurosciences orthopedics pulmonary critical care with health care facilities throughout virginia and north carolina, sentara treats a diverse population of patients. Because of our wealth of expertise, cutting-edge technology and centralized and cohesive research department, sentara continues to be a premier health research partner. Viii. Quality, patient safety, and community distinctions and awards a. Award-winning care - as always, sentara is proud and humbled by the various awards and recognitions the company received over the course of the year. Our mission is "we improve health every day". To receive an award is simply an added acknowledgement of our mission driven work. Here are a few of the 2022 awards and recognitions: i. Sentara health was named best employer - new grads, best employer - veterans, and america's best employer - all by forbes. Ii. Eleven sentara hospitals earned a "top performer in lgbtq healthcare equality" in the 2022 timeframe for the healthcare equality index (hei), a national lgbtq benchmarking tool from the human rights campaign. Iii. Sentara was acknowledged as a leading company in the "generous virginians" report published in virginia business in may 2022. Sentara provided $18 million to eastern virginia medical school (evms) and $2 million to the eastern virginia medical school's school of public health in 2021. And, in the category of total corporate donations to virginia nonprofits in 2021, sentara was top of the list with donations totaling $35 million. Iv. Sentara was named digital health most wired health system by the college of healthcare information management executives (chime). The digital health most wired program conducts an annual survey to assess how effectively healthcare organizations apply core and advanced technologies into their clinical and business programs to improve health and care in their communities. V. Sentara was awarded the regional corporation of the year - carolinas - virginia minority suppliers development council. The awar”

“Sentara health, a virginia nonstock corporation and the 501(c)(3) tax exempt parent of the sentara health system, maintains an agency relationship with the organization and issues all 1099s on its behalf. The number reported is a best estimate of the 1099s attributable to the organization. The exact number cannot be determined; as some of the 1099s issued by the agent are attributable to more than one entity, and there is no reporting mechanism to determine 1099's attributable solely to the organization.”

“The organization's board of directors is elected annually by sentara health, a virginia nonstock corporation and the 501(c)(3) tax exempt parent of the sentara health system. The governing board of sentara health is a community-based board comprised of 16 voting members, 15 of which are considered independent, as defined in the form 990 instructions.”

“Book reclass of intercompany account balances to equity 771,470. Partnership book tax difference -219,129.”