Ochsner Clinic Foundation

“When the organization evaluates its participation in a joint venture, the transactions are handled carefully to ensure that the organization's tax-exempt status is intact with regard to the arrangement. The operations of the joint venture are carefully reviewed by management and legal counsel, and the transaction is not entered into unless it is a reflection of the organization's tax-exempt purpose. A clause is inserted into the joint venture agreement that the operations of the joint venture must be performed in a manner that will not jeopardize the organization's tax-exempt status.”

“The articles of incorporation provide that no action of the board may be resolved unless a majority of the independent directors present approve the matter. Thus, even in situations where there is not an absolute majority of independent directors in office, those independent directors in office control ochsner health system's activities. The following actions require the majority approval of total members of the senior physician class, regardless of the number of senior physician class members actually voting: 1) amendments to the articles which affect the rights of sr. Physicians; 2) any change in the total number of directors, community directors, or sr. Physician directors; 3) the status of the ceo as a member of the board; and 4) changes to the supermajority requirements, which call for approval by two-third of the entire board for certain actions to be considered approved.”

“MR. SUQUET AND MRS. MESTAYER - Business relationship, MR. HINES AND MR. LECORGNE - Business relationship”

“The articles of incorporation were revised primarily to incorporate the merger of ochsner health system with and into ochsner clinic foundation. Ochsner health system, a related 501(c)(3) organization, was formerly the sole member of ochsner clinic foundation, and a supporting organization of ochsner clinic foundation.”

“One or more members of senior management review the return. The return is also reviewed by ernst & young us, llp, the company's tax advisors. The audit and oversight committee, which is comprised of independent directors, is then provided the return prior to the filing date and given the opportunity to review and discuss the return with management/staff. The meeting to review the 2017 return was held on october 29, 2018. A copy of the return is then provided to each member of the board of directors electronically and comments are solicited from the entire board.”

“Officers, directors, trustees, and key employees of ochsner health system and its subsidiaries are required to complete a conflict of interest disclosure form annually, or within 40 days of becoming an employee, or if a current employee has a change in business circumstances not previously disclosed. The conflict of interest program administrator reviews disclosures and determines whether action is necessary or if the disclosure needs to be reviewed by the conflict of interest steering committee. The conflict of interest steering committee will make mitigation recommendations, including, but not limited to, divestiture and termination of employment. Ochsner health system requires annual certification that the relationships disclosed during a preceding calendar year are complete and accurate. In addition, employees that do not fall within the scope of the conflict of interest disclosure policy annually complete conflict of interest training in compliance with the conflict of interest policy.”

“All ceo and officer compensation and benefits arrangements, including salary and bonus incentive plans, are reviewed and approved by the executive and senior physician compensation committee of the board of directors (compensation committee). No substantive change to the compensation or benefits packages is made until committee approval is granted in accordance with intermediate sanctions guidelines. The compensation committee is without conflicts of interest and uses an independent external consultant. Appropriate data is applied to determine the comparability of fair market value pay and all actions are appropriately documented. In order to meet the requirements of the irs intermediate sanctions regulations, the compensation committee identified the "disqualified individuals" that are in a position to exercise substantial influence over the company's operations. These individuals are the members of the executive officers committee (eoc), regional medical directors, physician board members and section heads for key departments. For disqualified individuals, the compensation review also includes the cost of benefits such as the company portion of medical and dental benefits, malpractice insurance, payments for 401k matching and pension payments.”

“Pt vi ln 15a describes the compensation process for many of the officers, key employees, and sr physician board members. A different review process is used for physicians. Annually, the physician compensation department reviews the compensation of each employed physician. This review includes a comparison of physician salaries against national survey data for their specialty. The physician compensation department compiles the compensation data for each physician including base salary, stipends, on-call pay, etc. Each physician's compensation as well as the total work relative value units (rvus) are compared to the survey data. Compensation for other non-officer and non-physician key employees is reviewed by senior executives who take market value research into consideration when determining compensation levels.”

“All governing documents, conflict of interest policy, and financial statements are available upon written request to the audit services department of ochsner clinic foundation. Forms 990 and 990-t are available upon request to the chief financial officer of ochsner clinic foundation. Financial statements for ochsner clinic foundation are made available to the public quarterly via www.dacbond.com.”

“Directors - average hours per week devoted to position the amount of time shown for those directors listed as "board member/senior physician" as "average hours per week devoted to position" on the form 990 for ochsner clinic foundation (ein 72-0502505) consists primarily of their role as an employee of ochsner clinic foundation. Additional time spent on boards, committees and through fulfilling other responsibilities as a member of any other boards of the varied ochsner organizations is shown as a nominal amount on that entity's form 990. As a senior physician director of an integrated health system, these individuals devote their time to board activities of all 501(c)(3) members of the system to varying degrees, both ochsner health system and ochsner clinic foundation. The amount of time shown for those directors listed as "community directors" for "average hours per week devoted to position" on the form 990 for ochsner clinic foundation (ein 72-0502505) is shown as a nominal amount additional time spent on boards, committees and through fulfilling other responsibilities as a member of one or more boards of the varied ochsner organizations, including time spent on boards, on committees and through fulfilling other responsibilities as a member of the board of varied ochsner organizations is included on the form 990 for ochsner health system. As a community director of an integrated health system, each community director devotes time to both 501(c)(3) members of the system to varying degrees, ochsner health system and ochsner clinic foundation.”

“Compensation of officers and average hours per week devoted to position compensation for bobby brannon, evp & treasurer, includes all compensation related to the integrated ochsner health system, which includes ochsner health system (ohs, ein 20-5296918) and ochsner clinic foundation (ocf, ein 72-0502505), both related 501(c)(3) organizations. The other member of the integrated health system is charged a portion of these amounts. The amount of time shown for each of the remaining officers as "average hours per week devoted to position" on this form of the organization that pays the officers directly consists primarily of their role as an officer of the integrated health system. Additional time spent on boards, committees and through fulfilling other responsibilities as an officer of the other ochsner organizations is shown as a nominal amount, but, in reality, the time is more evenly distributed across all entities.”

“Those directors listed as "board member/senior physician" are compensated entirely due to their role as an employee of a member of the integrated health system. Community directors are volunteers and are not paid a stipend or other compensation for their service to ochsner as board members. The compensation of community directors that is reported consists of ochsner's payments (either directly or as reimbursement) of expenses incurred for meeting or travel expenses for the board in which the reimbursement has been determined to be taxable income.”

“Compensation from integrated health system many of the individuals listed in part vii and schedule j hold positions with related 501(c)(3) organizations. For each of these individuals, the compensation listed is received from the related organization, and the compensation is for the individual's role as an employee of the related organization and the integrated health system. The amount of time shown for each as "average hours per week devoted to position" consists primarily of his/her time spent on his/her role with ochsner health system. In reality, his/her time is spent on fulfilling responsibilities through their roles with the related organization and/or across all other organizations in the integrated health system, and may be more evenly distributed.”

“VIII EQUITY INC JOINT VENTURE - Total Revenue: -158452, Related or Exempt Function Revenue: -393492, Unrelated Business Revenue: 235040, Revenue Excluded from Tax Under Sections 512, 513, or 514: ;”

“(Expenses $ 11,014,000 including grants of $)(Revenue $ 13,227,663) Ochsner Fitness Center: Designed to meet the health and fitness goals of its members, Ochsner Fitness Center ("the fitness center") provides fitness services to patients, employees, and other members of the community, including seniors and children. The fitness center serves the community as a valuable resource in the prevention of disease. The fitness center is integrated with Ochsner's patient care services through its medical fitness referral program and it's physical and occupational therapy services. The fitness center also provides outreach to the community, including educational programs, community nutrition outreach, and a youth obesity program.”

“(Expenses $ 2,047,230 including grants of $)(Revenue $ 2,047,230) Rent-Physical plant: Ochsner Clinic Foundation rents its physical plant to related 501(c)(3) organizations. The majority of the rental is to Brent House Corporation, a wholly-owned subsidiary and exempt 501(c)(3) organization. Brent House fully reimburses Ochsner for expenses related to the Hotel.”

“(Expenses $ 1,942,312 including grants of $)(Revenue $ 18,488) Ochsner maintains a free parking garage for employees and patients. Revenue is attributable to the optional valet parking service, which is offered for the convenience of Ochsner's patients.”

“(Expenses $ including grants of $)(Revenue $- 158,452) Program Related Investments: Equity Income from Joint Venture providing patient care.”

“Grants/Contributions/Fundraising included in Restricted Net Assets - -8778461; Net Assets released for Operations - 635664; Unrestricted Impairments Recovery - 408; Pension-related changes other than net periodic pension costs - 2668428; Change in Net Assets for Credit Tenant Lease facilities - 2508759; Loss on early extinguishment of debt - -9256366; Other Changes in Net Assets or Fund Balances - -46020; Restricted Contirbutions - -9398376; Net Assets of Ochsner Health System merged 12/31/2017 - 14222054;”

“The process regarding the committee responsible for the audit, review, or compilation of the organization's financial statements and selection of an independent accountant has not changed from the prior year.”

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