Community Health Choice Texas Inc

“Harris county hospital district (hchd) has certain enumerated reserved powers over the governing board of community health choice texas, inc. (chct). The governing body is prohibited from taking final action on the following without the approval by resolution of the hchd board of managers: 1. Adoption, amendment, or revocation of the bylaws of chct; 2. Adoption, amendment, or revocation of the articles of incorporation of chct; 3. Appointment or removal of directors or president and ceo of chct; 4. Adoption, amendment, or revocation of chct's purchasing manual; 5. Adoption, amendment, or revocation of chct's personnel policies; 6. Adoption, amendment, or revocation of chct's financial policies; 7. Adoption of chct's annual operating and capital budgets; 8. Any deviation of 10% or more from chct's annual operating budget or $100,000 from chct's annual capital budget; 9. Any transaction involving real property; 10. Any mortgage, encumbrances, or debt of chct in excess of $200,000; 11. The sale or other disposition of property of any kind exceeding $200,000; 12. The purchase or acquisition of property of any kind by chct exceeding $200,000 and not included in and approved by hchd's board of managers as part of chct's annual operating and capital budget; 13. All payments other than purchases, including guarantees and grants that are not included in and approved by hchd's board of managers as part of chct's annual operating and capital budgets; 14. Any action to amend, reduce, or enlarge the service area of chct's certificate of authority to do business as a health maintenance organization in the state of texas; 15. Any reorganization, consolidation, or the creation of any subsidiary or any other affiliated entity; 16. Any change in any of the contractual relationships between chct and chci (community health choice, inc.) and/or the hchd; 17. Any change in the mission, purposes, or business lines; 18. Any change in the principal office; 19. Purchase, adoption, amendment, cancellation or replacement of any insurance and/or self-insurance coverages required per the bylaws; 20. Commencement of any litigation in excess of $200,000; 21. Any merger, affiliation, dissolution, or other disposition of chct.”

“The organization engages a paid preparer, experienced in the preparation of the form 990, to prepare the form. Management, including certain officers, works diligently to help complete the form 990 and attached schedules in a thorough manner. Once prepared, it is reviewed by the organization's controller and then again by the chief financial officer. A copy of the return is then mailed or emailed to the board of directors.”

“The organization requires officers and key employees to disclose annually interests that could give rise to conflicts in annual statements. The chief compliance officer of the organization then reviews the annual statements before sending to the harris county hospital district corporate compliance department for further review of the annual conflict of interest statements. If at the conclusion of the investigation it is determined that a conflict of interest exists, the chief compliance officer, the chief legal officer, and appropriate members of chc administration will determine how best to address or manage the coi and determine whether mitigating strategies may be implemented.”

“The compensation of the president/ceo of the organization is reviewed by the board of directors of community health choice and hchd annually. The compensation of all other executive employees is subject to the guidelines and merit raise process of community health choice. In early 2022, an external compensation consulting firm assisted chc in evaluating executive employee compensation against market benchmarking for health insurance plan companies.”

“As a subsidiary of the harris county hospital district (a subsidiary of harris county, texas), all documents and policies are part of the public record and are therefore made available to the public upon request.”

“Prior to february 14, 2022, the cfo role was outsourced to an outside finance firm, bodwell vasek wells desimone, while the role was in transition. The amount paid for the services during the year was $231,630 for services to chct and $59,908 to chci, a related organization.”

“The organization's payroll is processed by and reported on forms w-2 & w-3 of related organization harris county hospital district (hchd). Related organization chci reimburses hchd for salaries and expenses incurred on behalf of chci and chct and then allocated the related portion of payroll expenses to chct. Part vii compensation is therefore reported 20% paid by chci and 80% paid by chct in an effort to report according to the related salary expense.”

“All compensated officers and directors have business relationships with each other by employment with related entity chci.”

“Salaries reflected on form 990, part ix, lines 5 and 7 were allocated to chct by the harris county hospital district (hchd) (fein: 76-0408224) and they are reflected on the form w-3, transmittal of wage and tax statements, of hchd. Chct reimbursed hchd for the salaries, and all other expenses incurred on behalf of chct. The number of forms 1099 and forms w-2 filed for the year is reported as 974 and 566, respectively.”

“Reconciliation of net assets other changes in net assets: capital transfer to hchd $(20,000,000) change in nonadmitted assets (105,874) _______________ total $(20,591,991)”