Scan Health Plan Arizona

“The organization amended and restated bylaws which were adopted by the Board of Directors and became effective on January 1, 2013. Changes to the organization's bylaws are as follows: Article 1: The sole member of the Corporation shall be SCAN Group (the "Corporate Member") The Corporate Member reserves a specific set of powers, thereby requiring the Corporation to seek prior approval for decisions within the scope of those powers. Key examples of these reserved powers include 1) the decision to borrow money; 2) the decision to enter into or amend any contractual arrangement that is not within the scope of the annual budget or operating plan previously approved by the Board of Directors (exclusive of provider services agreements) where payments by the Corporation are expected to exceed $2MM; 3) the decision to expand the service area of the Corporation, etc. A complete list of the decisions requiring prior approval is available upon request. Article 2, Section 2: Changes the number of Directors.”

“The Sole Member of the organization is SCAN Group, A California Nonprofit Corporation.”

“The sole member has the power to appoint the members of the Board of Directors.”

“The Form 990 is prepared by BDO USA, LLP, working in conjunction with SCAN's finance department. SCAN Health Plan's Director of accounting has direct responsibility for this effort, subject to supervision by the SCAN Health Plan Controller. After an initial draft of the Form 990 is prepared, it is circulated for review and comment by relevant members of the executive team who have responsibility and/or knowledge about the various matters disclosed and/or described in the Form. The General Counsel, in particular, reviews the Form 990 and ensures accuracy of descriptions and that disclosure is complete. The draft Form 990 is reviewed by the Audit and Compliance Committee in addition to the compensation committee of the Board of Directors of SCAN Group, and is shared with all members of the Board of Directors after it is ready for filing but before it is filed.”

“SCAN Health Plan Arizona regularly and consistently monitors and enforces compliance with its conflict of interest policy through annual circulation of a conflict of interest questionnaire which is required to be answered by all members of the Board of Directors, officers and members of executive management. In addition, there is regular education and enforcement through oversight of such policy and the SCAN Health Plan Arizona Gift and Business Courtesies Policy with respect to each department by members of the senior executive team with responsibility for such department. The Legal Department of SCAN Group reviews all contractual relationships entered into by the organization and the General Counsel of SCAN Group is responsible for monitoring conflicts of interest through the annual circulation and review of the conflict of interest questionnaire. Accordingly, the Legal Department of SCAN Group through the General Counsel is in a position to monitor and enforce compliance with the policy on an ongoing basis.”

“The process for determining the compensation of the President of SCAN Health Plan Arizona is conducted by the Compensation Committee of the Board of Directors of SCAN Group, all of the voting members of which are independent persons. In determining the President's compensation, the Compensation Committee works with and relies upon the counsel and expertise of Ernst & Young, a consultant with well-established experience and expertise in the area of nonprofit organization executive compensation and compliance with the intermediate sanctions requirements applicable to such compensation. Ernst & Young provides an "Executive Compensation Report" to the Compensation Committee each year which furnishes the basis for the establishment of the President's compensation package during the following year. The Ernst & Young Executive Compensation Report is based on a review of the executive compensation practices of a variety of organizations that are considered comparable to SCAN Health Plan Arizona based on various metrics. The Compensation Committee deliberates on the issue of the President's compensation package in light of the Ernst & Young Executive Compensation Report and questions are asked of, and answered by Ernst & Young, regarding such report and other matters relevant to such package. Based on such deliberations, the Compensation Committee makes a recommendation to the Board of Directors of SCAN Health Plan Arizona regarding the compensation package for the following year. The Board of Directors of SCAN Health Plan Arizona deliberates on and then votes on such recommendation; the President is recused for the entirety of such deliberations and vote. The minutes of the Compensation committee for these meetings are prepared substantially contemporaneously and substantiate such deliberations and decisions.”

“The process for determining the compensation of officers or other key employees of SCAN Health Plan Arizona is conducted by the Human Resources Department and CEO. In determining such employee's compensation, the Human Resources Department works with and relies upon the counsel and expertise of Ernst & Young, a consultant with well-established experience and expertise in the area of nonprofit organization executive compensation and compliance with the intermediate sanctions requirements applicable to such compensation. Ernst & Young provides an "Executive Compensation Report" to the Human Resources Department each year which furnishes the basis for the establishment of such employees' compensation package during the following year. The Ernst & Young Executive Compensation Report is based on a review of the executive compensation practices of a variety of organizations that are considered comparable to SCAN Health Plan Arizona based on various metrics.”

“SCAN Health Plan Arizona's governing documents and conflict of interest policy are not made available to the public. SCAN Health Plan Arizona's audited financial statements are publicly available from the Arizona Department of Insurance for a nominal fee.”

“For the current year, 2013, there is a decrease in the program services expensed by SCAN Health Plan Arizona. Effective, January 1, 2013, SCAN Health Plan Arizona entered into an agreement with Healthcare Partners Affiliates Medical Group ("HCP"), a California professional partnership for the provision of physician group services and certain third party administrative services. As a result, HCP now performs the services of processing all claims from the member's provider with exception of pharmacy claims and HCP assumed responsibility for patient management. SCAN Health Plan Arizona continues to manage the enrollment of new members and the reenrollment of existing members, process member billings and manage the member's receivables. For services rendered by HCP, SCAN Health Plan Arizona compensates HCP based on mutually agreed upon rates.”

“SCAN Health Plan Arizona began program operations as a Medicare Advantage contractor effective January 1, 2007. It is responsible for arranging and monitoring the full range of Medicare health services for plan enrollees. The plan began offering a Medicare advantage special needs plan (SNP) for beneficiaries who are dually eligible and enrolled in both the Medicare and ALTCS programs. Beginning January 1, 2009, the Plan expanded its Medicare advantage participation to other Medicare beneficiary populations, through a Medicare advantage prescription drug (MAPD) plan. In January 2008 SCAN launched the SCAN Connections community resource center designed to link SCAN members, their caregivers and others in the Maricopa county communities with knowledgeable staff who can assist in navigating a complex health care system. The resource center staff build bridges into other community organizations, governmental agencies and health advocacy groups to provide to the community health education and support services focused on geriatric, chronic illness and physically disabled challenges. Services and resources are provided at the SCAN Connections resource center in SCAN's office and at remote community sites. SCAN Health Plan Arizona has grown from no membership at December 31, 2006 and currently serves more than 12,932 enrollees. The addition of the SCAN C