Arkansas Children'S Medical Group PLLC

“The following board members had a business relationship during the fiscal year: crystal kohanke, robert williams, and gena wingfield. They served on the board of the children's healthcare system, which is an affiliated company.”

“During fy24, dr. Frederick barr, m.d. Is the sole member and officer of acmg. The medical group is a professional limited liability company that has an appointed board of managers. As the sole member and officer of a professional limited liability company that will engage in the practice of medicine, dr. Barr will be responsible for overseeing the quality of care provided by the medical group and for its compliance with health, regulatory, and other compliance requirements. Acmg is organized and operated at all times as a captive professional limited liability company to arkansas children's, inc. Through the captive relationship, arkansas children's has the authority to control the non-clinical operations and activities of acmg, to the extent permitted under the llc law, the membership control agreement, and the arkansas medical practices act. Acmg, dr. Barr, and arkansas children's separately entered into a membership control agreement, establishing certain restrictions on, and rights with respect to, the sale, transfer, exchange, disposition or other conveyances of the membership interests in the company held by the member. The purpose of the membership control agreement is to grant arkansas children's with control over the financial and all other non-clinical operations, activities and affairs of acmg. The agreement also establishes that acmg's member acknowledges and agrees that he holds the membership interest in acmg in a fiduciary capacity exclusively for the benefit of arkansas children's and not for his personal benefit. The agreement prevents the member from transferring the membership interest in acmg to anyone other than a qualified physician designated by arkansas children's. It further provides that the member may not take any action relating to the ownership, existence, business, financial and other non-clinical operations of the medical group, including amending the articles of organization or operating agreement, without the prior written consent from arkansas children's. Arkansas children's shall not exercise control over the clinical decisions, operations or activities of acmg. Arkansas children's has fundamental controls over the medical group to ensure that the medical group will operate for section 501(c)(3) purposes and consistently with the requirements of section 501(c)(3) status by: (i) ensuring that the medical group's member receives no financial benefit from holding the membership interests in the medical group, (ii) establishing that arkansas children's has the sole authority to designate the member(s) of the medical group, (iii) requiring that members have an employment or officer role with an entity within the arkansas children's health system, as well as active medical staff privileges at arkansas children's hospital or arkansas children's northwest, and (iv) requiring the approval of arkansas children's for all non-clinical matters.”

“Like many section 501(c)(3) tax-exempt captive professional entities, the membership interests in acmg are held by a single employee of the captor. The operating agreement of the medical group establishes that the medical group is managed by its board of managers, and that dr. Barr is the sole member. Dr. Barr also serves as the medical group's sole officer, holding the positions of president and secretary. The board of managers for fy24 consists of frederick barr, md, crystal kohanke, jamie wiggins, gena wingfield, christina dalton, do, ashay patel, do, and robert williams, md. Dr. Barr was the president and sole member of acmg for all of fy24, however he retired in september 2024 and his successor, rustin morse, m.d. Assumed the role of president and sole member of the company. As established in the membership control agreement, arkansas children's has fundamental controls over acmg to ensure that the medical group will operate for section 501(c)(3) purposes and consistently with the requirements of section 501(c)(3) status by: (i) ensuring that the medical group's member receives no financial benefit from holding the membership interests in the medical group, (ii) establishing that arkansas children's has the sole authority to designate the member(s) of the medical group, (iii) requiring that members have an employment or officer role with an entity within the arkansas children's health system, as well as active medical staff privileges at arkansas children's hospital or arkansas children's northwest, and (iv) requiring the approval of arkansas children's for all non-clinical matters.”

“See explanation at line 7a above.”

“The draft form 990, which is reconciled to the internal financial statements and the arkansas children's, inc. Consolidated audit report, is initially reviewed in detail with the vp of financial operations of arkansas children's, inc. The draft form 990 is then presented to the president of arkansas children's medical group for review prior to filing. If the review results in revisions to the form 990, those revisions are made. The form 990 to be filed is then provided to the entire board prior to filing.”

“Acmg maintains a conflict of interest policy which pertains to its members, managers and officers (covered persons). It states that such covered persons have an affirmative obligation to avoid wherever possible a conflict of interest (coi) with acmg. They must discharge their duties in good faith and in a manner they reasonably believe to be in the best interests of acmg and in furtherance of and consistent with its section 501(c)(3) tax-exempt purposes and status, especially in regard to transactions with acmg in which covered persons have a direct or indirect interest. The policy is intended to implement and supplement but not replace any applicable laws governing conflicts of interest applicable to acmg. Following are details regarding montitoring and compliance: a. Covered persons must fully disclose on an annual basis all actual or potential conflicts of interest of which they are aware, including any private interest in dealings with the pllc, by completing the conflict of interest disclosure statement. If the covered person becomes aware of an actual or potential conflict of interest following his or her annual completion of the coi disclosure statement, the covered person must disclose the conflict in writing to the acmg's sole member or, if the pllc is then managed by one or more managers, the managers, with a copy in each case to the chief compliance officer of arkansas children's, inc., as soon as possible. B. Duty to disclose: a covered person shall disclose in writing to the individuals noted above any actual or potential conflict of interest when the situation develops, including the facts that make it an actual or potential conflict. If at any time a single individual serves as the sole member or sole manager of the pllc, such disclosure shall be made to the chief compliance officer of arkansas children's, inc. C. Disclosure statements: each covered person shall sign a conflict of interest disclosure statement upon the covered person's acquisition of membership interests in acmg, election to the board of managers or election as an officer of acmg, as applicable. Each covered person also shall sign a conflict of interest disclosure statement annually, as noted above. If an actual or potential conflict of interest develops after the covered person's initial and annual statements are signed, the covered person shall sign a new conflict of interest disclosure statement immediately to disclose the new situation or transaction. All such disclosure statements shall be provided to the individuals noted above. D. Review of conflict of interest disclosure statements: conflict of interest disclosure statements or declared conflicts will be reviewed by the sole member of acmg or, the manager(s), if applicable. At any time during which a single individual serves as the sole member or sole manager of the pllc, the chief compliance officer of arkansas children's, inc. Shall also be provided with, and shall review, all conflict of interest disclosure statements or declared conflicts. E. Conflict of interest transactions process: review will result in one of the following actions by (which, if by the board of managers (if any), shall be by at least majority vote): (1) determined not to be a conflict; (2) conflict is accepted; or (3) conflict is not accepted and the covered person will need to abstain from participation in deliberation or voting on the conflicted matter. At any time during which a single individual serves as the sole member or sole manager of the pllc, the chief compliance officer of arkansas children's, inc., shall conduct such review and make such determination. F. Minutes recording compliance: conflict disclosures, facts and actions will be documented in the appropriate minutes or other records of the pllc. G. Failure to disclose: if the sole member or manager(s), reasonably believe(s) that a covered person has not disclosed an actual or potential conflict of interest, such person(s) shall inform that covered”

“Compensation for any acmg executive or senior officer (president; executive vice president; senior vice president) who is not a contracted uams employee is reviewed by the arkansas children's human resources and compensation committee which is established through the bylaws of arkansas children's, inc. The committee has the full authority and specific responsibility for reviewing and approving executive compensation practices as it relates to base salary, incentive compensation and total remuneration targets. The committee has specific responsibility for determining compensation for the health system president/ceo and for approval of recommendations made by the ceo for positions deemed as "disqualified persons" under section 4958 of the code. The policies and programs reviewed and approved by the committee shall be designed to ensure that the corporation and its affiliates remain competitive and reasonable relative to the compensation and total remuneration of similarly situated health systems locally and nationally, and to permit the corporation and such affiliates to attract and retain superior executives in furtherance of the corporation's and affiliates purposes. In its process, the committee shall obtain and must rely upon appropriate data as to comparability prior to making its determination of reasonableness with respect to the compensation arrangements of disqualified persons. Appropriate data includes, but is not limited to, compensation levels paid by similarly situated organizations, both taxable and tax-exempt, for functionally comparable positions, current compensation surveys compiled by independent firms; the committee may rely upon opinions of qualified legal, accounting, valuation and executive compensation experts. Contemporaneously with making its determination of reasonableness with respect to the compensation arrangement of the ceo and disqualified persons, the committee shall document in its minutes the basis for its decisions. A verbal report is provided to the board by the chair of the committee. Minutes are available for review upon board member request to the board chair. Compensation for any arkansas children's medical group physician or provider is reviewed by the arkansas children's medical group executive committee. Through the acmg policy on compensation arrangements with physicians, the executive committee has the full authority and specific responsibility for reviewing and approving compensation policies, base salary and incentive compensation levels, and other benefit plans for employed physicians. This policy is intended to ensure that compensation arrangements with physicians are made in accordance with a standardized process, and to ensure compliance with all applicable federal and state laws, including the federal physician self-referral law ("stark law") and the federal anti-kickback statute. The policy also promotes sound business and ethical judgments in connection with compensation arrangements with physicians. In its process, the committee obtains and relies upon appropriate data from multiple benchmark surveys prior to making its determination of reasonableness with respect to the compensation arrangements of physicians.”

“Arkansas children's medical group's form 990 is available to the public upon request.”

“Arkansas children's medical group's governing documents, conflict of interest policy, and financial statements are available to the public upon request as required.”

“It is part of the reserved powers of arkansas children's, inc. To retain, oversee and terminate independent external auditors to audit the financial statements of ach or of any affiliate. One of the standing committees of arkansas children's, the financial planning and oversight committee, shall undertake the following duties in the areas of finance and audits: (i) causing to be prepared, and submit to the board of directors at its last meeting before the end of the fiscal year, the capital and operating budgets of the corporation, as well as the capital and operating budgets of affiliates; (ii) examining the monthly financial reports of the health system; (iii) reviewing the internal auditing functions of the health system; (iv) engaging an external audit firm, subject to approval by the board of directors; (v) reviewing with the independent auditor the scope and planning of the audit prior to the commencement of the audit, as well as upon completion of the audit, reviewing and discussing with the independent auditor any material risks or weaknesses in internal controls identified by the auditor, any restrictions on the scope of the auditor's activities or access to requested information, any significant disagreements between the auditor and management, and the adequacy of the health system's accounting and financial reporting processes; (vi) annually considering the performance and independence of the independent auditor; (vii) reviewing and reporting to the board on the annual audited financial statement of the health system certified by the corporation's certified public accountants, together with such certified public accountants' management letter to the corporation which the committee shall review and report on to the board of directors; (viii) suggesting means to improve fiscal accountability and internal audit procedures for those areas identified as requiring improvement; (ix) providing oversight for the health system's corporate compliance program, including corporate ethics and compliance with legal and regulatory requirements; and (x) reporting on the financial planning and oversight committee's activities to the full board.”