Palo Alto Medical Foundation

“The affairs and management of Palo Alto Medical Foundation (PAMF) are supervised by the Executive Committee which has power to transact all regular business of PAMF during the period between meetings of the Board of Directors. The Executive Committee consists of up to sixteen Directors including: PAMF's Chair who serves as chair of the committee, the Chair of the Finance and Planning Committee, the President of PAMF, the Foundation CEO, the Hospital Corporation CEO, the Chair of the Hospital Corporation, the Chair of the Community Board (if a Director of PAMF), the Chief Operating Officer of the General Member, if such position is occupied and that person is a Designated Director of PAMF, and up to five (5) additional Appointed Directors who are not interested persons as defined in Section 5-1 D and up to four (4) physician Directors. FORM 990, PART VI, LINE 2 JOHN CUNNIFF, MD, RICHARD CARY HILL, MD, JOSEPH R. LACY, MD, HEATHER LINEBARGER, MD, ELIZABETH NEWSOM, MD, Norman Khan, MD and Sharon Tapper, MD HAVE A BUSINESS RELATIONSHIP.”

“This corporation is an affiliate of sutter health, a california nonprofit public benefit corporation. Sutter health is the sole member with the right to elect at least a majority of the members of the board of directors.”

“Sutter health as the sole member of the organization is entitled to exercise fully all rights and privileges of members of nonprofit corporations under the california nonprofit public benefit corporation law, and all other applicable laws. The member has the rights and powers to appoint (and remove) members of the corporation's board of directors, subject to the provisions of the bylaws. In addition, the member has the right to approve the following actions of the corporation's board of directors: (a) merger, consolidation, reorganization or dissolution of the corporation. (b) amendment or restatement of the articles of incorporation or the bylaws of the corporation. (c) adoption of operating budgets and capital budgets (although the board is empowered to develop its own budgets within the guidelines and objectives set by the general member). (d) expenditures beyond approved budgets and in excess of a dollar amount, not less than $200,000, to be set by the general member. (e) borrowing in excess of a dollar amount, not less than $200,000, to be set by the general member (for the purpose of this section 14.1, "borrowing" includes, but is not limited to, lease agreements and installment contracts). (f) purchase, sale, lease, disposition, hypothecation, exchange, gift, pledge or encumbrance of any asset, real or personal, with a value in excess of a dollar amount, not less than $200,000, to be set by the general member and not previously included in the capital budget. (g) appointment of an independent auditor and corporate counsel. (h) approval of transactions of this corporation in which a trustee or officer of this corporation has a material financial interest. (i) approval of selection of the chief executive officer. (j) adoption of quality improvement procedures or standards that do not meet or exceed guidelines or procedures established by the general member. (notwithstanding the foregoing, it is understood and agreed that the general member will not impose guidelines or procedures that may have a material adverse effect on the corporation, without the prior approval of this corporation.) (k) the creation of any subsidiary organization.”

“Sutter health, a related tax-exempt organization, has a centralized tax department responsible for the preparation of the form 990. Annually the tax department provides training and education to affiliate personnel who assist the tax department in collecting and reviewing data to be reported on the form 990. The preparation material is reviewed by various departments including tax, finance, legal, and human resources. A national accounting firm prepares and/or reviews the return. A completed return is then reviewed by the tax department, the affiliate, and the cfo before the return is filed.”

“Employees are educated on the conflict of interest policy and the need to make disclosure as part of annual compliance education. In addition, annually a disclosure statement is completed by all directors and officers that includes an acknowledgement that they have read the conflict of interest policy. On this statement the individual will list a wide range of information which includes business relationships, employment relationships, property interests, and those of related parties. The ceo and board chair will review the statements and monitor situations that may pose a potential conflict of interest. The ceo and board chair may consult with the office of the general counsel as necessary. If there is a potential conflict of interest related to a particular transaction, the interested individual must disclose the existence and nature of the relationship. The board chair may appoint a disinterested person or committee to investigate the conflict. Until the potential conflict is resolved, the board chair may request the individual to not participate during related presentations and discussions. In all circumstances involving an actual conflict, the interested individual shall refrain from voting on any matter related to the transaction.”

“The compensation committee of the sutter health board of directors retains ultimate discretionary authority over all elements of compensation to ensure that organizational purposes are appropriately being served. The compensation committee uses credible data sources and maintains an objective "arms length" decision-making process, ensuring the integrity of sutter's executive programs and consistency with the organization's overall mission. In order to ensure external competitiveness, national, california and local market area compensation data comparisons are reviewed. Competitive analysis includes: (a) base salary, (b) total cash (base salary + annual incentive) and (c) total remuneration (base salary + annual incentive + benefits and long term incentive). This analysis includes comparable organizations and geographic considerations. For the most senior executive positions, national comparisons for organizations similar in size, scope and complexity as sutter health are most appropriate since it is a national marketplace in which sutter competes for executive talent. On the other hand, because california's underlying compensation structure is higher than national data (especially in the bay area), regional pay comparisons and adjustments are made. Officers and key employees of this organization who are sutter health employees undergo a review and compensation committee approval, and such approval is recorded in the minutes. The compensation review process was last completed in december of 2014.”

“The sutter health system posts its current and past audited financial statements at sutterhealth.org. Other documents are also located at this website including the annual report, mission statement, history, and links to affiliate websites. The governing documents are not available to the public at this time.”

“We enhance the well-being of the people in our communities through compassion, excellence and innovation in health care service, research and education.”

“THE PALO ALTO MEDICAL FOUNDATION THE PALO ALTO MEDICAL FOUNDATION FOR HEALTH CARE, RESEARCH AND EDUCATION (PAMF) IS A NOT-FOR-PROFIT HEALTH CARE ORGANIZATION THAT IS A PIONEER IN BOTH MULTISPECIALTY GROUP PRACTICE OF MEDICINE AND OUTPATIENT MEDICINE. IN 1993, PAMF AFFILIATED WITH SUTTER HEALTH, A FAMILY OF NOT-FOR-PROFIT HOSPITALS AND PHYSICIAN ORGANIZATIONS THAT SHARE RESOURCES AND EXPERTISE TO ADVANCE HEALTH CARE QUALITY. IN 2009, PAMF, MILLS-PENINSULA HEALTH SERVICES (MPHS), SUTTER MATERNITY AND SURGERY CENTER AND MENLO PARK SURGICAL HOSPITAL CAME TOGETHER TO FORM SUTTER HEALTH'S PENINSULA COASTAL REGION. SERVING COMMUNITIES THROUGHOUT NORTHERN CALIFORNIA, SUTTER HEALTH IS A REGIONAL LEADER IN CARDIAC CARE AS WELL AS CARE OF WOMEN AND CHILDREN, AND IS A PIONEER IN ADVANCED PATIENT SAFETY TECHNOLOGY. IN 2008, THE PHYSICIANS OF THE FORMER CAMINO MEDICAL GROUP, PALO ALTO MEDICAL CLINIC AND SANTA CRUZ MEDICAL CLINIC MERGED INTO A SINGLE PHYSICIAN GROUP CALLED THE PALO ALTO FOUNDATION MEDICAL GROUP (PAFMG) TO CONTRACT WITH PAMF TO PROVIDE PHYSICIAN SERVICES AND IN 2010, A NEW MULTISPECIALTY PHYSICIAN GROUP, PENINSULA MEDICAL CLINIC (PMC), WAS FORMED. NOW, PAMF'S 1,328 AFFILIATED PHYSICIANS AND 5,313 EMPLOYEES SERVE NEARLY 800,000 PATIENTS AT 45 SITES THROUGHOUT THE BAY AREA. In 2014, there were 747,745 patients served. PAMF'S MISSION IS TO ENHANCE THE WELL-BEING OF THE PEOPLE IN OUR COMMUNITIES THROUGH COMPASSION, EXCELLENCE AND INNOVATION IN HEALTH CARE SERVICES, RESEARCH AND EDUCATION. PAMF HAS THREE DIVISIONS: 1. HEALTH CARE 2. EDUCATION 3. RESEARCH HEALTH CARE DIVISION PAMF'S HEALTH CARE DIVISION CONSISTS OF FIVE DIVISIONS: 1. PALO ALTO, SERVING ALAMEDA, SAN MATEO AND SANTA CLARA COUNTIES 2. CAMINO, SERVING SANTA CLARA COUNTY 3. SANTA CRUZ, SERVING SANTA CRUZ COUNTY 4. MILLS-PENINSULA, SERVING SAN MATEO COUNTY 5. ALAMEDA, SERVING ALAMEDA COUNTY THESE DIVISIONS OFFER MORE THAN 45 MEDICAL SPECIALTIES, A FULL RANGE OF MEDICAL SERVICES, AND STATE-OF-THE-ART TECHNOLOGY. THIS TECHNOLOGY INCLUDES THE MOST ADVANCED DIAGNOSTIC IMAGING AND TREATMENT DEVICES, AN ELECTRONIC HEALTH RECORD SYSTEM, THREE LICENSED ACUTE CARE FACILITIES, AND ONE ACCREDITED HOME HEALTH AGENCY. PAMF'S ADVANCED CAPABILITIES AND EMPHASIS ON OUTPATIENT CARE ALLOW PHYSICIANS AND STAFF TO MINIMIZE HOSPITALIZATION OF PATIENTS, REDUCING THE OVERALL COST OF MEDICAL CARE SIGNIFICANTLY WHILE MAINTAINING THE HIGHEST QUALITY OF CARE FOR PATIENTS. AS PART OF ITS COMMITMENT TO SERVING ITS COMMUNITY, PAMF PROVIDES CARE TO MEDICALLY INDIGENT PATIENTS AND THOSE ENROLLED IN MEDICARE, MEDI-CAL, AND OTHER GOVERNMENT PROGRAMS WHOSE REIMBURSEMENTS FALL SHORT OF COVERING THE COST OF PROVIDING CARE. RECENT ACHIEVEMENTS - FOR THE Eleventh CONSECUTIVE YEAR, THE INTEGRATED HEALTHCARE ASSOCIATION (IHA) NAMED PAMF AS ONE OF THE MOST OUTSTANDING PHYSICIAN GROUPS IN CALIFORNIA BASED ON ITS PAY-FOR-PERFORMANCE (P4P) PROGRAM. IN OVERALL PERFORMANCE, PAMF RANKED AS A "TOP PERFORMER" IN PATIENT EXPERIENCE, INFORMATION TECHNOLOGY AND CLINICAL QUALITY, SUCH AS CANCER SCREENINGS, IMMUNIZATIONS AND DIABETES CARE. - PAMF RECEIVED THE HIGHEST RECOGNITION - ELITE STATUS OF FOUR STARS - FROM THE CALIFORNIA ASSOCIATION OF PHYSICIAN GROUPS (CAPG) IN ITS ANNUAL STANDARDS OF EXCELLENCE SURVEY IN JUNE 2013. THE VOLUNTARY SURVEY ASSESSES HOW WELL CALIFORNIA MEDICAL GROUPS MEET THE EXPECTATIONS OF HEALTH CARE PURCHASERS AND PATIENTS. IT FOCUSES ON TOOLS AND PROCESSES THAT IMPROVE AFFORDABILITY AND PATIENT EXPERIENCE. - PAMF IS CURRENTLY RATED FOUR OUT OF FOUR STARS FOR PATIENT EXPERIENCE BY THE CALIFORNIA OFFICE OF THE PATIENT ADVOCATE (OPA) IN A STATEWIDE ASSESSMENT OF ALL MEDICAL GROUPS. MEDICAL GROUPS ARE RANKED IN TWO CATEGORIES: MEETING NATIONAL STANDARDS OF CARE AND PATIENT RATINGS. THE OPA, AN INDEPENDENT STATE OFFICE IN CONJUNCTION WITH THE DEPARTMENT OF MANAGED HEALTH CARE, WAS CREATED TO REPRESENT THE INTERESTS OF HEALTH PLAN MEMBERS TO GET THE CARE THEY DESERVE AND TO PROMOTE TRANSPARENCY AND QUALI”

“RESEARCH DIVISION PAMF'S RESEARCH PROGRAMS ARE NATIONALLY KNOWN AND HAVE MADE NUMEROUS DISCOVERIES LEADING TO IMPROVEMENT OF CARE FOR THE ENTIRE COMMUNITY. RECENT EXAMPLES ARE AS FOLLOWS: Publications in 2014 included the following: - Jose PO, Frank AT, Kapphahn KI, Goldstein BA, Eggleston K, Hastings KG, Cullen MR, Palaniappan LP. Cardiovascular disease mortality in Asian Americans. Journal of the American College of Cardiology. - May SG, Cheng PH, Tietbohl CK, Trujillo L, Reilly K, Frosch DL, Lin GA. Shared medical appointments to screen for geriatric syndromes: preliminary data from a quality improvement initiative. Journal of American Geriatric Society. - Thompson CA, Gomez SL, Chan A, Chan JK, McClellan SR, Chung S, Olson C, Nimbal V, Palaniappan LP. Patient and provider characteristics associated with colorectal, breast, and cervical cancer screening among Asian Americans. Cancer Epidemiology Biomarkers and Prevention. - Lv N, Xiao L, Camargo CA Jr, Wilson SR, Buist AS, Strub P, Nadeau KC, MaJ. Abdominal and general adiposity and level of asthma control in adults with uncontrolled asthma. Annals of the American Thoracic Society. - Chung S, Azar KM, Baek M, Lauderdale DS, Palaniappan LP. Reconsidering the age thresholds for type II diabetes screening in the U.S. American Journal of Preventive Medicine. - Romanelli RJ, Segal JB. Predictors of statin compliance after switching from branded to generic agents among managed-care beneficiaries. Journal of General Internal Medicine. - Hussey PS, Luft HS, McNamara P. Public reporting of provider performance at a crossroads in the United States: summary of current barriers and recommendations on how to move forward. Medical Care Research and Review. - Halley MC, Rendle KA, Gillespie KA, Stanley KM, Frosch DL. An exploratory mixed-methods crossover study comparing DVD- vs. Web-based patient decision support in three conditions: The importance of patient perspectives. Health Expect. - Lesser LI, Puhl RM. Alternatives to monetary incentives for employee weight loss. American Journal of Preventive Medicine. - Chung S, Panattoni L, Hung D, Johns N, Trujillo L, Tai-Seale M. Why do we observe a limited impact of primary care access measures on clinical quality indicators? Journal of Ambulatory Care Management. - Tai-Seale M, Wilson CJ, Panattoni L, Kohli N, Stone A, Hung DY, Chung S. Leveraging electronic health records to develop measurements for processes of care. Health Services Research. - Wilson SR, Knowles SB, Huang Q, Fink A. The prevalence of harmful and hazardous alcohol consumption in older U.S. adults: data from the 2005-2008 National Health and Nutrition Examination Survey (NHANES). Journal of General Internal Medicine. Palo Alto Medical Foundation Research Institute (PAMFRI) has secure sponsorships and funding from numerous prominent organizations including: - National Institute of Diabetes and Digestive and Kidney Diseases - National Heart, Lung, and Blood Institute - Patient-Centered Outcomes Research Institute (PCORI) - National Institute on Aging - National Institute on Minority Health and Health Disparities - Agency for Healthcare Research and Quality (AHRQ) - Palo Alto Medical Foundation (PAMF) - Sutter Health - Robert Wood Johnson Foundation - American Diabetes Association - Richard & Susan Levy Family Trust - Gordon and Betty Moore Foundation - The California Endowment - California Breast Cancer Research Program - California HealthCare Foundation - John A. Hartford Foundation - NutritionQuest The PAMFRI staff have led a long list of health services and health policy studies. Some of the key studies in 2014 are as follows: PROJECT TITLE: Measurement of Quality of Life and Perceived Disease Impact on Quality of Life in Asthma FUNDER: National Heart, Lung and Blood Institute PRINCIPAL INVESTIGATOR: Sandra Wilson, Ph.D. PROJECT TITLE: Research Aimed at Improving Both Mood and Weight FUNDER: National Heart, Lung and Blood Institute PRINCIPAL INVESTIGATOR: JUN MA, M.D., PH”

“Medical group compensation $ 590,477,536 construction sevices $ 232,765 professional fees physician $ 38,297 therapist and other medical $ 382,712 nurse registry $ 86,333 ----------- total $591,217,643 ============”

“Equity transfers (net) $(172,970,223) interest income from k-1 (184) rental income from k-1 (38,436) ordinary income from k-1 (1,052,989) 1231 gain from k-1 (102,965) partnership income on books 1,170,871 annuity true-up (47,957) change in split interest 28,003 stock and other items (223,935) other change 75,549 -------------- total $ (173,162,266) ==============”