4A (Expenses $ 100198209 including grants of $ 29915) (Revenue $ 133811077)
EXPENSES INCURRED IN PROVIDING INPATIENT, OUTPATIENT AND EMERGENCY MEDICALLY NECESSARY SERVICES TO ALL INDIVIDUALS IN A NON-DISCRIMINATORY MANNER REGARDLESS OF RACE, COLOR, CREED, SEX, NATIONAL ORIGIN OR ABILITY TO PAY. PLEASE REFER TO SCHEDULE O FOR THE ORGANIZATION'S COMMUNITY BENEFIT STATEMENT (STATEMENT OF PROGRAM SERVICES) WHICH INCLUDES DETAILED INFORMATION REGARDING THE VARIOUS SERVICES PROVIDED BY THIS ORGANIZATION.

SCHEDULE H, PART V, SECTION B, QUESTION 5
IN ITS MOST RECENTLY CONDUCTED CHNA CRMC TOOK INTO ACCOUNT INPUT FROM PERSONS WHO REPRESENT THE BROAD INTERESTS OF THE COMMUNITY SERVICED BY THE HOSPITAL FACILITY. THIS COMPREHENSIVE REPORT IS THE RESULT OF A THOROUGH ASSESSMENT OF THE COMMUNITIES HEALTHCARE PROFILE, INCLUDING A REVIEW OF PUBLIC HEALTH DATA AND DATA OBTAINED BY MEANS OF FOCUS GROUPS AND ONE ON ONE INTERVIEWS. CRMC INITIATED SEVEN SEPARATE ONE HOUR FOCUS GROUPS WITHIN THE COMMUNITIES OF CAPE MAY COUNTY. THE FOCUS GROUPS DISCUSSED HEALTH CONCERNS OF THE PARTICIPANTS. ADDITIONALLY, OVER 150 INDIVIDUAL DISCUSSIONS WERE CONDUCTED WITH COMMUNITY LEADERS, HEALTHCARE PROFESSIONALS AND COMMUNITY RESIDENTS THROUGHOUT CAPE MAY COUNTY.

SCHEDULE H, PART V, SECTION B, QUESTION 6B
CRMC HAS A LONGSTANDING AND ACTIVE PARTNERSHIP WITH MANY SOCIAL AND CIVIC ORGANIZATIONS, FAITH COMMUNITIES, SCHOOLS AND LOCAL EMPLOYERS. THE CHNA IS THE RESULT OF A COLLABORATIVE EFFORT WITH VARIOUS COMMUNITY PARTNERS WHO WORKED TOGETHER TO IDENTIFY THE MOST-PRESSING HEALTHCARE NEEDS IN CAPE MAY COUNTY. CRMC'S CHNA COMMUNITY PARTNERS INCLUDE THE FOLLOWING: - ANGELIC HOSPICE AND PALLIATIVE CARE; - CAPE MAY COUNTY CHAMBER OF COMMERCE; - CAPE MAY COUNTY DEPARTMENT OF AGING AND DISABILITY SERVICES; - CAPE MAY COUNTY DEPARTMENT OF HEALTH; - CAPE MAY COUNTY DEPARTMENT OF HUMAN SERVICES; - CAPE ASSIST; - CAPE COUNSELING; - CAPE REGIONAL HEALTH SYSTEM; - CAPE REGIONAL PHYSICIAN ASSOCIATES; - CARING FOR KIDS; - CHRIST GOSPEL CHURCH; - COMPLETE CARE; - CONCERNED CITIZENS OF WHITESBORO; - CURE; - LOWER TOWNSHIP SCHOOL DISTRICT; - MIDDLE TOWNSHIP POLICE DEPARTMENT; - PREVENTION PARTNERSHIP; - PUERTO RICAN ACTION COMMITTEE; - RUTGERS COOPERATIVE EXTENSION; AND - VOLUNTEERS IN MEDICINE.

SCHEDULE H, PART V, SECTION B, QUESTION 7A
"THE ORGANIZATION IS AN AFFILIATE WITHIN CAPE REGIONAL HEALTH SYSTEM, INC. AND AFFILIATES; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM (""SYSTEM""). DUE TO CHARACTER LIMITATIONS, THE WEBSITE LISTED IN PART V, SECTION B, QUESTION 7A, IS THE HOME PAGE FOR THE SYSTEM. THE CHNA CAN BE ACCESSED AT THE FOLLOWING PAGE INCLUDED IN THE SYSTEM'S WEBSITE: WWW.CAPEREGIONAL.COM/ABOUT-US/COMMUNITY-HEALTH-NEEDS-ASSESSMENT"

SCHEDULE H, PART V, SECTION B, QUESTION 10
THE CHNA INCLUDES THE CRMC WRITTEN IMPLEMENTATION STRATEGY AS REQUIRED UNDER INTERNAL REVENUE CODE SECTION 501(R)(3). THE IMPLEMENTATION STRATEGY INCLUDES INFORMATION WITH RESPECT TO EACH IDENTIFIED COMMUNITY HEALTH NEED AS WELL AS THE GOALS, PROGRAMS, ACTIVITIES AND OUTCOMES RELATED TO EACH IDENTIFIED NEED. THE ORGANIZATION'S IMPLEMENTATION STRATEGY IS INCLUDED WITHIN ITS CHNA. THESE DOCUMENTS ARE MADE WIDELY AVAILABLE ON THE ORGANIZATION'S WEBSITE. DUE TO CHARACTER LIMITATIONS, THE WEBSITE LISTED IN PART V, SECTION B, QUESTION 10, IS THE HOME PAGE FOR THE SYSTEM. THE CHNA AND IMPLEMENTATION STRATEGY CAN BE ACCESSED AT THE FOLLOWING PAGE INCLUDED IN THE SYSTEM'S WEBSITE: WWW.CAPEREGIONAL.COM/ABOUT-US/COMMUNITY-HEALTH-NEEDS-ASSESSMENT

SCHEDULE H, PART V, SECTION B, QUESTION 11
AFTER ANALYZING DATA GATHERED FROM THE FOCUS GROUP MEETINGS AND DISCUSSIONS WITH COMMUNITY MEMBERS, THE FOLLOWING TOP FOUR HEALTH CONCERNS WERE IDENTIFIED: 1) CANCER; 2) CARDIOVASCULAR DISEASE; 3) DIABETES/OBESITY; AND 4) MENTAL HEALTH/SUBSTANCE ABUSE DISORDER. THE ORGANIZATION'S IMPLEMENTATION STRATEGY, WHICH IS INCLUDED WITHIN THE CHNA, DESCRIBES CRMC'S GOALS ON HOW THE ABOVE HEALTH CONCERNS ARE BEING ADDRESSED. IT ALSO INCLUDES PLANNED ACTIVITIES BY CRMC TO ASSIST IN ADDRESSING THE SIGNIFICANT NEEDS. PLEASE REFER TO THE ORGANIZATION'S IMPLEMENTATION STRATEGY INCLUDED ON ITS WEBSITE FOR ADDITIONAL INFORMATION.

SCHEDULE H, PART V, SECTION B, QUESTION 16
"THE ORGANIZATION IS AN AFFILIATE WITHIN CAPE REGIONAL HEALTH SYSTEM, INC. AND AFFILIATES; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM (""SYSTEM""). DUE TO CHARACTER LIMITATIONS, THE WEBSITE LISTED IN PART V, SECTION B, QUESTION 16, IS THE HOME PAGE FOR THE SYSTEM. THE ORGANIZATION'S FINANCIAL ASSISTANCE POLICY, FINANCIAL ASSISTANCE APPLICATION AND PLAIN LANGUAGE SUMMARY ARE MADE WIDELY AVAILABLE ON THE ORGANIZATION'S WEBSITE. THESE DOCUMENTS CAN BE ACCESSED AT THE FOLLOWING PAGE INCLUDED IN THE SYSTEM'S WEBSITE: HTTPS://WWW.CAPEREGIONAL.COM/FINANCE"

SCHEDULE H, PART I, LINE 3C
"IN ADDITION TO THE FEDERAL POVERTY GUIDELINES, CAPE REGIONAL MEDICAL CENTER USES OTHER FACTORS IN DETERMINING ELIGIBILITY CRITERIA FOR FREE AND DISCOUNTED CARE. AS OUTLINED IN PART V, SECTION B, QUESTION 13, OTHER FACTORS TO DETERMINE ELIGIBILITY INCLUDE: - ASSET LEVEL; - MEDICAL INDIGENCY; - INSURANCE STATUS; - UNDERINSURANCE STATUS; AND - RESIDENCY. ADDITIONAL INFORMATION WITH RESPECT TO CRMC'S ELIGIBILITY CRITERIA FOR FINANCIAL ASSISTANCE IS OUTLINED BELOW. NEW JERSEY HOSPITAL CHARITY CARE PAYMENT ASSISTANCE PROGRAM (""CHARITY CARE"") --------------------------------------------------------------------- CHARITY CARE IS A NEW JERSEY PROGRAM IN WHICH FREE OR DISCOUNTED CARE IS AVAILABLE TO PATIENTS WHO RECEIVE INPATIENT AND OUTPATIENT SERVICES AT ACUTE CARE HOSPITALS THROUGHOUT THE STATE OF NEW JERSEY. HOSPITAL ASSISTANCE AND REDUCED CHARGE CARE ARE ONLY AVAILABLE FOR NECESSARY EMERGENCY OR OTHER MEDICALLY NECESSARY CARE. PATIENTS MAY BE ELIGIBLE FOR CHARITY CARE IF THEY ARE NEW JERSEY RESIDENTS WHO: 1) HAVE NO HEALTH COVERAGE OR HAVE COVERAGE THAT PAYS ONLY PART OF THE HOSPITAL BILL (UNINSURED OR UNDERINSURED); 2) ARE INELIGIBLE FOR ANY PRIVATE OR GOVERNMENTAL SPONSORED COVERAGE (SUCH AS MEDICAID); AND 3) MEET THE FOLLOWING INCOME AND ASSET ELIGIBILITY CRITERIA DESCRIBED BELOW. INCOME CRITERIA: PATIENTS WITH FAMILY GROSS INCOME LESS THAN OR EQUAL TO 200% OF FEDERAL POVERTY GUIDELINES (""FPG"") ARE ELIGIBLE FOR 100% CHARITY CARE COVERAGE. PATIENTS WITH FAMILY GROSS INCOME GREATER THAN 200% AND LESS THAN OR EQUAL TO 300% OF FPG ARE ELIGIBLE FOR DISCOUNTED CARE. FREE CARE OR PARTIALLY COVERED CHARGES WILL BE DETERMINED BY USE OF THE NEW JERSEY DEPARTMENT OF HEALTH FEE SCHEDULE. IF PATIENTS ON THE 20% TO 80% SLIDING FEE SCALE ARE RESPONSIBLE FOR QUALIFIED OUT-OF-POCKET PAID MEDICAL EXPENSES IN EXCESS OF 30% OF THEIR GROSS ANNUAL INCOME (I.E. BILLS UNPAID BY OTHER PARTIES), THEN THE AMOUNT IN EXCESS OF 30% IS CONSIDERED HOSPITAL CARE PAYMENT ASSISTANCE. ASSET CRITERIA: CHARITY CARE INCLUDES ASSET ELIGIBILITY THRESHOLDS WHICH STATES THAT INDIVIDUAL ASSETS CANNOT EXCEED $7,500 AND FAMILY ASSETS CANNOT EXCEED $15,000 AS OF THE DATE OF SERVICE. CHARITY CARE MAY BE AVAILABLE TO NON-NEW JERSEY RESIDENTS, REQUIRING IMMEDIATE MEDICAL ATTENTION FOR AN EMERGENCY MEDICAL CONDITION. NEW JERSEY UNINSURED DISCOUNT (PUBLIC LAW 2008, C. 60) ------------------------------------------------------ UNINSURED PATIENTS WITH FAMILY GROSS INCOME LESS THAN 500% OF FPG MAY BE ELIGIBLE FOR DISCOUNTED CARE UNDER THIS PROGRAM. ELIGIBLE INDIVIDUALS MUST BE NEW JERSEY RESIDENTS. IF A PATIENT HAS FAMILY GROSS INCOME: - BELOW $75,000, CHARGES MAY BE DISCOUNTED TO CURRENT MEDICARE RATES. - BETWEEN $75,001 AND $100,000, CHARGES MAY BE DISCOUNTED TO CURRENT MEDICARE RATES PLUS 5%. - BETWEEN $100,001 AND 500% OF FPG, CHARGES MAY BE DISCOUNTED TO CURRENT MEDICARE RATES PLUS 15%. NJ FAMILYCARE ------------- NJ FAMILYCARE IS NEW JERSEY'S PUBLICLY FUNDED HEALTH INSURANCE PROGRAM WHICH INCLUDES CHIP, MEDICAID AND MEDICAID EXPANSION POPULATIONS. NJ FAMILYCARE IS A FEDERAL AND STATE FUNDED HEALTH INSURANCE PROGRAM CREATED TO HELP QUALIFIED NEW JERSEY RESIDENTS OF ANY AGE ACCESS TO AFFORDABLE HEALTH INSURANCE. NJ FAMILYCARE IS FOR PEOPLE WHO DO NOT HAVE EMPLOYER INSURANCE. FINANCIAL ELIGIBILITY FOR INDIVIDUALS SEEKING ELIGIBILITY FOR NJ FAMILYCARE WILL BE BASED ON THEIR MODIFIED ADJUSTED GROSS INCOME (""MAGI""). NJFAMILYCARE ELIGIBILITY GUIDELINES ARE ESTABLISHED BY THE STATE OF NEW JERSEY AND CAN BE FOUND AT WWW.NJFAMILYCARE.ORG. A PATIENT CAN BE PRESUMED ELIGIBLE FOR NJFAMILYCARE ONCE IN A TWELVE MONTH PERIOD. NEW JERSEY CANCER EDUCATION AND EARLY DETECTION (""NJCEED"") ---------------------------------------------------------- THE NJCEED PROGRAM PROVIDES COMPREHENSIVE OUTREACH, EDUCATION AND SCREENING SERVICES FOR BREAST, CERVICAL, COLORECTAL AND PROSTATE CANCERS. A PATIENT MUST BE UNINSURED OR UNDERINSURED AND MUST HAVE FAMILY GROSS INCOME AT OR BELOW 250% OF FPG TO BE ELIGIBLE. ADDITIONAL INFORMATION CAN BE FOUND AT THE FOLLOWING WEBSITE: WWW.NJ.GOV/HEALTH/CANCER/NJCEED. CATASTROPHIC ILLNESS IN CHILDREN RELIEF FUND -------------------------------------------- THE CATASTROPHIC ILLNESS IN CHILDREN RELIEF FUND PROVIDES FINANCIAL ASSISTANCE TO FAMILIES OF CHILDREN WITH A CATASTROPHIC ILLNESS. IN ORDER TO BE ELIGIBLE, HOSPITAL EXPENSES MUST EXCEED 10% OF THE FAMILY'S GROSS INCOME, PLUS 15% OF ANY EXCESS INCOME OVER $100,000, THE CHILD MUST HAVE BEEN 21 YEARS OR YOUNGER WHEN THE MEDICAL EXPENSES WERE INCURRED AND THE FAMILY MUST HAVE LIVED IN NEW JERSEY FOR THREE MONTHS IMMEDIATELY PRIOR TO THE DATE OF APPLICATION. ADDITIONAL INFORMATION CAN BE FOUND AT THE FOLLOWING WEBSITE: WWW.STATE.NJ.US/HUMANSERVICES/CICRF/HOME. NEW JERSEY VICTIMS OF CRIME COMPENSATION OFFICE ----------------------------------------------- THE STATE OF NEW JERSEY HAS ESTABLISHED THE NEW JERSEY VICTIMS OF CRIME COMPENSATION OFFICE TO COMPENSATE VICTIMS OF CRIME FOR LOSSES AND EXPENSES, INCLUDING CERTAIN MEDICAL EXPENSES, RESULTING FROM CERTAIN CRIMINAL ACTS. IN ORDER TO BE ELIGIBLE FOR NEW JERSEY VICTIMS OF CRIME COMPENSATION OFFICE THE CRIME MUST HAVE OCCURRED IN NEW JERSEY OR MUST RELATE TO A NEW JERSEY RESIDENT VICTIMIZED OUTSIDE OF THE STATE, THE VICTIM MUST HAVE REPORTED THE CRIME TO POLICE WITHIN NINE MONTHS AND VICTIM MUST COOPERATE WITH THE INVESTIGATION AND PROSECUTION OF THE CRIME. THE CLAIM MUST BE FILED WITHIN THREE YEARS OF THE DATE OF THE CRIME AND THE PATIENT MUST BE AN INNOCENT VICTIM OF THE CRIME. ADDITIONAL INFORMATION CAN BE FOUND AT HTTPS://WWW.STATE.NJ.US/LPS/NJVICTIMS/TEMPLATES/HOME.HTM AMOUNTS GENERALLY BILLED (""AGB"") -------------------------------- PURSUANT TO INTERNAL REVENUE CODE SECTION 501(R)(5), IN THE CASE OF EMERGENCY OR OTHER MEDICALLY NECESSARY CARE, FAP-ELIGIBLE PATIENTS WILL NOT BE CHARGED MORE THAN AN INDIVIDUAL WHO HAS INSURANCE COVERING SUCH CARE. PATIENTS MAY BE ELIGIBLE FOR THIS DISCOUNT IF THEY ARE UNINSURED AND HAVE FAMILY GROSS INCOME LESS THAN 500% OF FPG. ADDITIONALLY, UNDERINSURED PATIENTS MAY BE ELIGIBLE IF THEIR FAMILY GROSS INCOME IS GREATER THAN 200% BUT LESS THAN OR EQUAL TO 300% OF FPG."

SCHEDULE H, PART I, LINE 6A
NOT APPLICABLE.

SCHEDULE H, PART I, LINE 7
WORKSHEET 2 WAS USED FOR THE COST TO CHARGE RATIO.

SCHEDULE H, PART II
COMMUNITY BUILDING ACTIVITIES UNDERTAKEN BY THIS ORGANIZATION IMPROVE THE MEDICAL AND SOCIOECONOMIC WELL-BEING OF THE COMMUNITIES IN OUR CARE. THIS IS ACCOMPLISHED THROUGH SERVICE ON STATE AND REGIONAL ADVOCACY COMMITTEES AND BOARDS, VOLUNTEERISM WITH LOCAL COMMUNITY-BASED NON-PROFIT ADVOCACY GROUPS, AND PARTICIPATION IN CONFERENCES AND OTHER EDUCATIONAL ACTIVITIES TO PROMOTE UNDERSTANDING OF THE ROOT CAUSES OF HEALTH CONCERNS. THIS ORGANIZATION PROVIDES EDUCATIONAL MATERIALS, CONDUCTS COMMUNITY HEALTH FAIRS AND HOLDS HEALTH EDUCATION SEMINARS AND OUTREACH SESSIONS FOR ITS PATIENTS AND FOR COMMUNITY PROVIDERS. PRESENTATIONS ARE PROVIDED BY PHYSICIANS, NURSES AND OTHER HEALTHCARE PROFESSIONALS.

SCHEDULE H, PART III, LINE 8
"MEDICARE COSTS WERE DERIVED FROM THE 2021 MEDICARE COST REPORT. THE ORGANIZATION FEELS THAT MEDICARE UNDERPAYMENTS (SHORTFALL), BAD DEBT AND ASSOCIATED COSTS ARE COMMUNITY BENEFIT AND ARE INCLUDABLE ON THE FORM 990, SCHEDULE H, PART I. AS OUTLINED MORE FULLY BELOW, THE ORGANIZATION BELIEVES THAT THESE SERVICES AND RELATED COSTS PROMOTE THE HEALTH OF THE COMMUNITY AS A WHOLE AND ARE RENDERED IN CONJUNCTION WITH THE ORGANIZATION'S CHARITABLE TAX-EXEMPT PURPOSES AND MISSION IN PROVIDING MEDICALLY NECESSARY HEALTHCARE SERVICES TO ALL INDIVIDUALS IN A NON-DISCRIMINATORY MANNER WITHOUT REGARD TO RACE, COLOR, CREED, SEX, NATIONAL ORIGIN OR ABILITY TO PAY AND CONSISTENT WITH THE COMMUNITY BENEFIT STANDARD PROMULGATED BY THE IRS. THE COMMUNITY BENEFIT STANDARD IS THE CURRENT STANDARD FOR A HOSPITAL FOR RECOGNITION AS A TAX-EXEMPT AND CHARITABLE ORGANIZATION UNDER INTERNAL REVENUE CODE (""IRC"") 501(C)(3). THE ORGANIZATION IS RECOGNIZED AS A TAX-EXEMPT ENTITY AND CHARITABLE ORGANIZATION UNDER 501(C)(3) OF THE IRC. ALTHOUGH THERE IS NO DEFINITION IN THE TAX CODE FOR THE TERM ""CHARITABLE"" A REGULATION PROMULGATED BY THE DEPARTMENT OF THE TREASURY PROVIDES SOME GUIDANCE AND STATES THAT ""THE TERM CHARITABLE IS USED IN SECTION 501(C)(3) IN ITS GENERALLY ACCEPTED LEGAL SENSE,PROVIDES EXAMPLES OF CHARITABLE PURPOSES, INCLUDING THE RELIEF OF THE POOR OR UNPRIVILEGED; THE PROMOTION OF SOCIAL WELFARE; AND THE ADVANCEMENT OF EDUCATION, RELIGION, AND SCIENCE. NOTE IT DOES NOT EXPLICITLY ADDRESS THE ACTIVITIES OF HOSPITALS. IN THE ABSENCE OF EXPLICIT STATUTORY OR REGULATORY REQUIREMENTS APPLYING THE TERM ""CHARITABLE"" TO HOSPITALS, IT HAS BEEN LEFT TO THE IRS TO DETERMINE THE CRITERIA HOSPITALS MUST MEET TO QUALIFY AS IRC 501(C)(3) CHARITABLE ORGANIZATIONS. THE ORIGINAL STANDARD WAS KNOWN AS THE CHARITY CARE STANDARD. THIS STANDARD WAS REPLACED BY THE IRS WITH THE COMMUNITY BENEFIT STANDARD WHICH IS THE CURRENT STANDARD. CHARITY CARE STANDARD IN 1956, THE IRS ISSUED REVENUE RULING 56-185, WHICH ADDRESSED THE REQUIREMENTS HOSPITALS NEEDED TO MEET IN ORDER TO QUALIFY FOR IRC 501(C)(3) STATUS. ONE OF THESE REQUIREMENTS IS KNOWN AS THE ""CHARITY CARE STANDARD."" UNDER THE STANDARD, A HOSPITAL MUST PROVIDE, TO THE EXTENT OF ITS FINANCIAL ABILITY, FREE OR REDUCED-COST CARE TO PATIENTS WHO CANNOT PAY FOR SUCH SERVICES. A HOSPITAL THAT EXPECTED FULL PAYMENT DID NOT, ACCORDING TO THE RULING, PROVIDE CHARITY CARE BASED ON THE FACT THAT SOME PATIENTS ULTIMATELY FAILED TO PAY. THE RULING EMPHASIZED THAT A LOW LEVEL OF CHARITY CARE DID NOT NECESSARILY MEAN THAT A HOSPITAL HAD FAILED TO MEET THE REQUIREMENT SINCE THAT LEVEL COULD REFLECT ITS FINANCIAL ABILITY TO PROVIDE SUCH CARE. THE RULING ALSO NOTED THAT PUBLICLY SUPPORTED COMMUNITY HOSPITALS WOULD NORMALLY QUALIFY AS CHARITABLE ORGANIZATIONS BECAUSE THEY SERVE THE ENTIRE COMMUNITY AND A LOW LEVEL OF CHARITY CARE WOULD NOT AFFECT A HOSPITAL'S EXEMPT STATUS IF IT WAS DUE TO THE SURROUNDING COMMUNITY'S LACK OF CHARITABLE DEMANDS. COMMUNITY BENEFIT STANDARD IN 1969, THE IRS ISSUED REVENUE RULING 69-545, WHICH ""REMOVED"" FROM REVENUE RULING 56-185 ""THE REQUIREMENTS RELATING TO CARING FOR PATIENTS WITHOUT CHARGE OR AT RATES BELOW COST."" UNDER THE STANDARD DEVELOPED IN REVENUE RULING 69-545, WHICH IS KNOWN AS THE ""COMMUNITY BENEFIT STANDARD,"" HOSPITALS ARE JUDGED ON WHETHER THEY PROMOTE THE HEALTH OF A BROAD CLASS OF INDIVIDUALS IN THE COMMUNITY. THE RULING INVOLVED A HOSPITAL THAT ONLY ADMITTED INDIVIDUALS WHO COULD PAY FOR THE SERVICES (BY THEMSELVES, PRIVATE INSURANCE, OR PUBLIC PROGRAMS SUCH AS MEDICARE), BUT OPERATED A FULL-TIME EMERGENCY ROOM THAT WAS OPEN TO EVERYONE. THE IRS RULED THAT THE HOSPITAL QUALIFIED AS A CHARITABLE ORGANIZATION BECAUSE IT PROMOTED THE HEALTH OF PEOPLE IN ITS COMMUNITY. THE IRS REASONED THAT BECAUSE THE PROMOTION OF HEALTH WAS A CHARITABLE PURPOSE ACCORDING TO THE GENERAL LAW OF CHARITY, IT FELL WITHIN THE ""GENERALLY ACCEPTED LEGAL SENSE"" OF THE TERM ""CHARITABLE,"" AS REQUIRED BY THE DEPARTMENT OF TREASURY REG. 1.501(C)(3)-1(D)(2). THE IRS RULING STATED THAT THE PROMOTION OF HEALTH, LIKE THE RELIEF OF POVERTY AND THE ADVANCEMENT OF EDUCATION AND RELIGION, IS ONE OF THE PURPOSES IN THE GENERAL LAW OF CHARITY THAT IS DEEMED BENEFICIAL TO THE COMMUNITY AS A WHOLE EVEN THOUGH THE CLASS OF BENEFICIARIES ELIGIBLE TO RECEIVE A DIRECT BENEFIT FROM ITS ACTIVITIES DOES NOT INCLUDE ALL MEMBERS OF THE COMMUNITY, SUCH AS INDIGENT MEMBERS OF THE COMMUNITY, PROVIDED THAT THE CLASS IS NOT SO SMALL THAT ITS RELIEF IS NOT OF BENEFIT TO THE COMMUNITY. THE IRS CONCLUDED THAT THE HOSPITAL WAS ""PROMOTING THE HEALTH OF A CLASS OF PERSONS THAT IS BROAD ENOUGH TO BENEFIT THE COMMUNITY"" BECAUSE ITS EMERGENCY ROOM WAS OPEN TO ALL AND IT PROVIDED CARE TO EVERYONE WHO COULD PAY, WHETHER DIRECTLY OR THROUGH THIRD-PARTY REIMBURSEMENT. OTHER CHARACTERISTICS OF THE HOSPITAL THAT THE IRS HIGHLIGHTED INCLUDED THE FOLLOWING: ITS SURPLUS FUNDS WERE USED TO IMPROVE PATIENT CARE, EXPAND HOSPITAL FACILITIES, AND ADVANCE MEDICAL TRAINING, EDUCATION AND RESEARCH; IT WAS CONTROLLED BY A BOARD OF TRUSTEES THAT CONSISTED OF INDEPENDENT CIVIC LEADERS; AND HOSPITAL MEDICAL STAFF PRIVILEGES WERE AVAILABLE TO ALL QUALIFIED PHYSICIANS. THE AMERICAN HOSPITAL ASSOCIATION (""AHA"") FEELS THAT MEDICARE UNDERPAYMENTS (SHORTFALL) AND BAD DEBT ARE COMMUNITY BENEFIT AND THUS INCLUDABLE ON THE FORM 990, SCHEDULE H, PART I. THIS ORGANIZATION AGREES WITH THE AHA'S POSITION. AS OUTLINED IN THE AHA'S LETTER TO THE IRS DATED AUGUST 21, 2007 WITH RESPECT TO THE FIRST PUBLISHED DRAFT OF THE NEW FORM 990 AND SCHEDULE H, THE AHA FELT THAT THE IRS SHOULD INCORPORATE THE FULL VALUE OF THE COMMUNITY BENEFIT THAT HOSPITALS PROVIDE BY COUNTING MEDICARE UNDERPAYMENTS (SHORTFALL) AS QUANTIFIABLE COMMUNITY BENEFIT FOR THE FOLLOWING REASONS: - PROVIDING CARE FOR THE ELDERLY AND SERVING MEDICARE PATIENTS IS AN ESSENTIAL PART OF THE COMMUNITY BENEFIT STANDARD - MEDICARE, LIKE MEDICAID, DOES NOT PAY THE FULL COST OF CARE. FROM THE LATEST DATA PROVIDED BY THE AHA, AS OF 2017, MEDICARE REIMBURSES HOSPITALS ONLY 87 CENTS FOR EVERY DOLLAR THEY SPEND TO TAKE CARE OF MEDICARE PATIENTS. - MANY MEDICARE BENEFICIARIES, LIKE THEIR MEDICAID COUNTERPARTS, ARE POOR. MORE THAN 42 PERCENT OF MEDICARE SPENDING IS FOR BENEFICIARIES WHOSE INCOME IS BELOW 200 PERCENT OF THE FEDERAL POVERTY LEVEL. MANY OF THOSE MEDICARE BENEFICIARIES ARE ALSO ELIGIBLE FOR MEDICAID -- SO CALLED ELIGIBLE."" THERE IS EVERY COMPELLING PUBLIC POLICY REASON TO TREAT MEDICARE AND MEDICAID UNDERPAYMENTS SIMILARLY FOR PURPOSES OF A HOSPITAL'S COMMUNITY BENEFIT AND INCLUDE THESE COSTS ON FORM 990, SCHEDULE H, PART I. MEDICARE UNDERPAYMENT MUST BE SHOULDERED BY THE HOSPITAL IN ORDER TO CONTINUE TREATING THE COMMUNITY'S ELDERLY AND POOR. THESE UNDERPAYMENTS REPRESENT A REAL COST OF SERVING THE COMMUNITY AND SHOULD COUNT AS A QUANTIFIABLE COMMUNITY BENEFIT. BOTH THE AHA AND THIS ORGANIZATION ALSO FEEL THAT PATIENT BAD DEBT IS A COMMUNITY BENEFIT AND THUS INCLUDABLE ON THE FORM 990, SCHEDULE H, PART I. LIKE MEDICARE UNDERPAYMENT (SHORTFALLS), THERE ALSO ARE COMPELLING REASONS THAT PATIENT BAD DEBT SHOULD BE COUNTED AS QUANTIFIABLE COMMUNITY BENEFIT AS FOLLOWS: - A SIGNIFICANT MAJORITY OF BAD DEBT IS ATTRIBUTABLE TO LOW-INCOME PATIENTS, WHO, FOR MANY REASONS, DECLINE TO COMPLETE THE FORMS REQUIRED TO ESTABLISH ELIGIBILITY FOR HOSPITALS' CHARITY CARE OR THOSE WHO DO NOT PAY ALL, OR A PORTION OF THE ALREADY DISCOUNTED BILLED AMOUNTS UNDER OUR FINANCIAL ASSISTANCE POLICY. A 2006 CONGRESSIONAL BUDGET OFFICE (""CBO"") REPORT, NONPROFIT HOSPITALS AND THE PROVISION OF COMMUNITY BENEFITS, CITED TWO STUDIES INDICATING THAT ""THE GREAT MAJORITY OF BAD DEBT WAS ATTRIBUTABLE TO PATIENTS WITH INCOMES BELOW 200% OF THE FEDERAL POVERTY LINE."" - THE REPORT ALSO NOTED THAT A SUBSTANTIAL PORTION OF BAD DEBT IS PENDING CHARITY CARE. UNLIKE BAD DEBT IN OTHER INDUSTRIES, HOSPITAL BAD DEBT IS COMPLICATED BY THE FACT THAT HOSPITALS FOLLOW THEIR MISSION TO THE COMMUNITY AND TREAT EVERY PATIENT THAT COMES THROUGH THEIR EMERGENCY DEPARTMENT, REGARDLESS OF ABILITY TO PAY. PATIENTS WHO HAVE OUTSTANDING BILLS ARE NOT TURNED AWAY, UNLIKE OTHER INDUSTRIES. BAD DEBT IS FURTHER COMPLICATED BY THE AUDITING INDUSTRY'S STANDARDS ON REPORTING CHARITY CARE. MANY PATIENTS CANNOT OR DO NOT PROVIDE THE NECESSARY, EXTENSIVE DOCUMENTATION REQUIRED TO BE DEEMED CHARITY CARE BY AUDITORS. AS A RESULT, ROUGHLY 40% OF BAD DEBT IS PENDING CHARITY CARE. THE CBO CONCLUDED THAT ITS FINDINGS ""SUPPORT THE VALIDITY OF THE USE OF UNCOMPENSATED CARE [BAD DEBT AND CHARITY CARE] AS A MEASURE OF COMMUNITY BENEFIT"" ASSUMING THE FINDINGS ARE GENERALIZABLE NATIONWIDE; THE EXPERIENCE OF HOSPITALS AROUND THE NATION REINFORCES THAT THEY ARE GENERALIZABLE. AS OUTLINED BY THE AHA, DESPITE THE HOSPITAL'S BEST EFFORTS AND DUE DILIGENCE, PATIENT BAD DEBT IS A PART OF THE HOSPITAL'S MISSION AND CHARITABLE PURPOSES. BAD DEBT REPRESENTS PART OF THE BURDEN HOSPITALS SHOULDER IN SERVING ALL"

SCHEDULE H, PART VI; QUESTION 7
THE ENTITY AND RELATED PROVIDER ORGANIZATIONS ARE LOCATED IN NEW JERSEY. THE STATE OF NEW JERSEY DOES NOT REQUIRE HOSPITALS TO ANNUALLY FILE A COMMUNITY BENEFIT REPORT.

SCHEDULE H, PART III, LINE 2, 3 & 4
BAD DEBT EXPENSE WAS CALCULATED USING THE PROVIDERS' BAD DEBT EXPENSE FROM FINANCIAL STATEMENT, NET OF ACCOUNTS WRITTEN OFF AT CHARGES. THE AMOUNT REFLECTED ON SCHEDULE H, PART III, LINE 2 WAS ARRIVED AT BY APPLYING THE ORGANIZATION'S COST TO CHARGE RATIO TO ITS TOTAL BAD DEBT EXPENSE. PATIENT SERVICE REVENUE PATIENT SERVICE REVENUE IS REPORTED AT THE AMOUNTS THAT REFLECT THE CONSIDERATION TO WHICH THE MEDICAL CENTER IS EXPECTED TO BE ENTITLED TO IN EXCHANGE FOR PROVIDING PATIENT CARE FOR BOTH THE HOSPITAL AND ANY EMPLOYED PHYSICIANS. THESE AMOUNTS ARE DUE FROM PATIENTS, THIRD-PARTY PAYORS (INCLUDING MANAGED CARE ORGANIZATIONS AND GOVERNMENT PROGRAMS, I.E., MEDICARE AND MEDICAID), AND OTHERS AND THEY INCLUDE VARIABLE CONSIDERATION FOR RETROACTIVE ADJUSTMENTS DUE TO SETTLEMENT OF FUTURE AUDITS, REVIEWS, AND INVESTIGATIONS. RETROACTIVE ADJUSTMENTS ARE CONSIDERED IN THE RECOGNITION OF REVENUE ON AN ESTIMATED BASIS IN THE PERIOD THE RELATED SERVICES ARE RENDERED, AND SUCH AMOUNTS ARE ADJUSTED IN FUTURE PERIODS AS ADJUSTMENTS BECOME KNOWN OR AS YEARS ARE NO LONGER SUBJECT TO SUCH AUDITS, REVIEWS, AND INVESTIGATIONS. GENERALLY, PATIENTS AND THIRD-PARTY PAYORS ARE BILLED SEVERAL DAYS AFTER THE SERVICES ARE PERFORMED OR SHORTLY AFTER DISCHARGE. PATIENT SERVICE REVENUE IS RECOGNIZED IN THE PERIOD IN WHICH THE PERFORMANCE OBLIGATIONS ARE SATISFIED UNDER CONTRACTS BY TRANSFERRING SERVICES TO PATIENTS. PERFORMANCE OBLIGATIONS ARE DETERMINED BASED ON THE NATURE OF THE SERVICES PROVIDED. THE MEDICAL CENTER RECOGNIZES REVENUES FOR PERFORMANCE OBLIGATIONS SATISFIED OVER TIME BASED ON ACTUAL CHARGES INCURRED IN RELATION TO TOTAL EXPECTED CHARGES. THE MEDICAL CENTER BELIEVES THAT THIS METHOD PROVIDES AN APPROPRIATE DEPICTION OF THE TRANSFER OF SERVICES OVER THE TERM OF PERFORMANCE OBLIGATIONS BASED ON THE INPUTS NEEDED TO SATISFY THE OBLIGATIONS. GENERALLY, PERFORMANCE OBLIGATIONS ARE SATISFIED OVER TIME RELATED TO PATIENTS RECEIVING INPATIENT ACUTE CARE SERVICES. THE MEDICAL CENTER MEASURES PERFORMANCE OBLIGATIONS FROM ADMISSION TO THE POINT WHEN THERE ARE NO FURTHER SERVICES REQUIRED FOR THE PATIENT, WHICH IS GENERALLY THE TIME OF DISCHARGE. THE MEDICAL CENTER RECOGNIZES REVENUES FOR PERFORMANCE OBLIGATIONS SATISFIED AT A POINT IN TIME, WHICH GENERALLY RELATE TO PATIENTS RECEIVING OUTPATIENT SERVICES, WHEN: (1) SERVICES ARE PROVIDED; AND (2) WHEN IT IS BELIEVED THE PATIENT DOES NOT REQUIRE ADDITIONAL SERVICES FOR THE EPISODE OF CARE.

SCHEDULE H, PART VI; QUESTION 2
IN ADDITION TO THE COMMUNITY HEALTH NEEDS ASSESSMENT PROCESS OUTLINED IN SCHEDULE H, PART V, SECTION B, QUESTIONS 1-12 AND SECTION C, THIS ORGANIZATION CONDUCTS A REVIEW OF KEY FACTOR INFORMATION ANNUALLY WHICH INCLUDES: (1) A REVIEW OF HEALTHCARE UTILIZATION OF ITS SERVICE AREA POPULATION BY SERVICES (UROLOGY, CARDIOLOGY, OBSTETRICS, ETC.) FOR DETERMINING INCREASED OR DECREASED HEALTH NEEDS; HEALTHCARE SERVICE ESTIMATES AND FORECASTS (BOTH INPATIENT AND OUTPATIENT); (2) ASSESSMENTS OF LOCAL DEMOGRAPHIC AND SOCIOECONOMIC INFORMATION; AND (3) A REVIEW OF HEALTH STATUS/NEEDS ASSESSMENTS AND STUDIES CONDUCTED BY EXTERNAL PARTIES (HEALTH RESEARCH AND EDUCATION TRUST OF NEW JERSEY, KID'S COUNT, NEW JERSEY HEALTH & SENIOR SERVICES DEPARTMENT, ETC). THIS ORGANIZATION CONDUCTS AN EXTENSIVE SERVICE AREA POPULATION PHYSICIAN NEED STUDY (BY PRIMARY AND SPECIALTY) EVERY THREE TO FIVE YEARS. SPECIFIC SPECIALTY NEEDS ARE CONDUCTED FOR IDENTIFIED GAPS IN SERVICE. THESE REVIEWS INFORM MEDICAL STAFF DEVELOPMENT AT THE MEDICAL CENTER TO ASSURE RESPONSIVENESS TO IDENTIFIED COMMUNITY NEEDS. IN ADDITION, THIS ORGANIZATION WORKS WITH LOCAL PROVIDERS TO PLAN AND DISCUSS HEALTH NEEDS OF THE POPULATION.

SCHEDULE H, PART VI; QUESTION 3
"IN ACCORDANCE WITH INTERNAL REVENUE CODE SECTION 501(R)(4) CRMC INFORMS AND EDUCATES PATIENTS AND PERSONS WHO MAY BE BILLED FOR PATIENT CARE ABOUT THEIR ELIGIBILITY FOR FINANCIAL ASSISTANCE BY WIDELY PUBLICIZING VARIOUS DOCUMENTS. THESE DOCUMENTS ARE WIDELY PUBLICIZED IN THE FOLLOWING WAYS: (1) CAPE'S FAP, APPLICATION AND PLS ARE ALL AVAILABLE ON-LINE AT THE FOLLOWING WEBSITE: HTTPS://WWW.CAPEREGIONAL.COM/FINANCE (2) PAPER COPIES OF THE FAP, APPLICATION AND THE PLS ARE AVAILABLE UPON REQUEST WITHOUT CHARGE BY MAIL AND ARE AVAILABLE IN AT VARIOUS AREAS THROUGHOUT THE HOSPITAL FACILITY WHICH INCLUDE THE EMERGENCY DEPARTMENT, ADMISSIONS/REGISTRATION DEPARTMENTS AND PATIENT FINANCIAL SERVICES OFFICES. (3) CAPE'S FAP, APPLICATION AND PLS ARE AVAILABLE IN ENGLISH AND IN THE PRIMARY LANGUAGE OF POPULATIONS WITH LIMITED PROFICIENCY IN ENGLISH (""LEP"") THAT CONSTITUTE THE LESSER OF 1,000 INDIVIDUALS OR 5% OF THE COMMUNITY SERVED BY CAPE'S PRIMARY SERVICE AREA. CAPE PROVIDES LANGUAGE INTERPRETING AND TRANSLATION SERVICES, AND PROVIDES INFORMATION TO PATIENTS WITH VISION, SPEECH, HEARING OR COGNITIVE IMPAIRMENTS IN A MANNER THAT MEETS THE PATIENT'S NEEDS. (4) ALL PATIENTS ARE OFFERED A COPY OF THE PLS AS PART OF THE INTAKE OR DISCHARGE PROCESS. (5) SIGNS OR DISPLAYS ARE CONSPICUOUSLY POSTED IN PUBLIC MEDICAL CENTER LOCATIONS INCLUDING THE EMERGENCY DEPARTMENT, ADMISSIONS/REGISTRATION DEPARTMENTS AND PATIENT FINANCIAL SERVICES OFFICES THAT NOTIFY AND INFORM PATIENTS ABOUT THE AVAILABILITY OF FINANCIAL ASSISTANCE. (6) CAPE ALSO MAKES REASONABLE EFFORTS TO INFORM MEMBERS OF THE COMMUNITY ABOUT THE AVAILABILITY OF FINANCIAL ASSISTANCE. CAPE ACCOMPLISHES THIS THROUGH ITS INVOLVEMENT WITH VARIOUS OTHER AGENCIES IN CAPE MAY COUNTY."

SCHEDULE H, PART III, LINE 9B
"ACCOUNTS CONSIDERED TO BE FINANCIAL ASSISTANCE ARE NOT INCLUDED IN THE BAD DEBT EXPENSE, BUT RATHER, ACCOUNTED FOR AS AN ALLOWANCE. CRMC'S BILLING AND COLLECTION POLICIES AND PROCEDURES ARE OUTLINED WITHIN THE ORGANIZATION'S FINANCIAL ASSISTANCE POLICY (""FAP""). THIS POLICY CONTAINS PROVISIONS ON THE COLLECTION PRACTICES TO BE FOLLOWED FOR PATIENTS WHO ARE KNOWN TO QUALIFY FOR FINANCIAL ASSISTANCE. THESE PROVISIONS INCLUDE THE FOLLOWING: COLLECTION PROCEDURES --------------------- (1) STATEMENTS ARE MAILED AT NO LESS THAN 28 DAY INTERVALS SHOWING THE CURRENT ACTIVITY AND BALANCE. EACH BILLING STATEMENT INCLUDES CONSPICUOUS WRITTEN NOTICE WHICH INFORMS THE RECIPIENT ABOUT THE AVAILABILITY OF FINANCIAL ASSISTANCE. THE STATEMENT ALSO INCLUDES THE WEBSITE OF WHERE AN INDIVIDUAL CAN OBTAIN COPIES OF THE FAP, APPLICATION FOR FINANCIAL ASSISTANCE (""APPLICATION"") OR PLAIN LANGUAGE SUMMARY (""PLS""). ADDITIONALLY, IT INCLUDES THE TELEPHONE NUMBER THAT PATIENTS CAN CALL IF THEY HAVE QUESTIONS REGARDING THE AVAILABILITY OF FINANCIAL ASSISTANCE AND THE APPLICATION PROCESS. (2) IF NO PAYMENT IS MADE BY 31 DAYS AFTER THE INITIAL STATEMENT THE ACCOUNT WILL BE ELECTRONICALLY TRANSFERRED TO NATIONAL PATIENT ACCOUNT SERVICES (""NPAS"") FOR THE COLLECTION PROCESS. NPAS WILL SEND THREE DATA MAILERS AND MAKE PHONE CALLS WHEN APPROPRIATE. IF NO PAYMENT IS MADE THE ACCOUNTS WILL BE ELECTRONICALLY CLOSED AND A 48-HOUR LETTER WILL BE GENERATED BY THE BUSINESS OFFICE OF THE HOSPITAL EXPLAINING TO THE PATIENT THE COLLECTION PROCESS. (3) EACH STATEMENT OFFERS THE PATIENT A PAYMENT PLAN ON THE REVERSE SIDE OF THE DATA MAILER, A SPACE FOR CREDIT CARD INFORMATION AND A SPACE FOR INSURANCE INFORMATION. (4) ACCOUNTS WILL BE CONSIDERED FOR BAD DEBT TRANSFER WHEN THEY HAVE REACHED 120 DAYS FROM THE DATE OF THE 1ST POST-DISCHARGE BILLING STATEMENT, WITH EXCEPTION OF BAD ADDRESSES. (5) AFTER THE LAST STATEMENT IS SENT AND THERE IS NO RESPONSE FROM THE DEBTOR, THE MANAGERS OR DIRECTOR WILL REVIEW THE ACCOUNT FOR COLLECTABILITY TO INSURE PROPER PRE-COLLECTION PROCEDURES HAVE BEEN FOLLOWED. A DETERMINATION WILL BE MADE TO HOLD THE ACCOUNT IN HOUSE FOR AN ADDITIONAL PERIOD OF TIME FOR FURTHER FOLLOW-UP, SEND IT TO A COLLECTION AGENCY OR PURSUE THROUGH APPROPRIATE LEGAL ACTION. (6) RETURN MAIL, WHETHER STATEMENT, LETTER OR BILL, WILL BE DOCUMENTED IN THE PATIENT'S FILE AND INVESTIGATED FOR A GOOD ADDRESS. IF CAPE IS UNABLE TO DETERMINE A NEW MAILING ADDRESS, IT WILL BE DOCUMENTED IN THE ACCOUNT AND IT WILL BE PLACED FOR COLLECTIONS. (7) A CONTRACT WILL BE ESTABLISHED WITH THE PATIENT'S WRITTEN OR VERBAL PERMISSION FOR MONTHLY PAYMENTS OF A SET AMOUNT. CREDIT ARRANGEMENTS: - NON-EMERGENT SERVICES 50% DEPOSIT; - BALANCE: UNDER $500.00 DUE IN 90 DAYS; - UNDER $1000.00 DUE IN 180 DAYS; - UNDER $1500.00 DUE IN 12 MONTHS; AND - GREATER THAN $1500.00 NOT MORE THAN 24 MONTHS. INTERNAL REVENUE CODE SECTION 501(R)(6) --------------------------------------- CAPE DOES NOT ENGAGE IN ANY EXTRAORDINARY COLLECTION ACTIONS (""ECAS"") AS DEFINED BY INTERNAL REVENUE CODE SECTION 501(R)(6) PRIOR TO THE EXPIRATION OF THE ""NOTIFICATION PERIOD"". THE NOTIFICATION PERIOD IS DEFINED AS A 120-DAY PERIOD, WHICH BEGINS ON THE DATE OF THE 1ST POST-DISCHARGE BILLING STATEMENT, IN WHICH NO ECAS MAY BE INITIATED AGAINST THE PATIENT. SUBSEQUENT TO THE NOTIFICATION PERIOD CAPE, OR ANY THIRD PARTIES ACTING ON THEIR BEHALF, MAY INITIATE THE FOLLOWING ECAS AGAINST A PATIENT FOR AN UNPAID BALANCE IF A FAP-ELIGIBILITY DETERMINATION HAS NOT BEEN MADE OR IF AN INDIVIDUAL IS INELIGIBLE FOR FINANCIAL ASSISTANCE. - REPORTING ADVERSE INFORMATION ABOUT THE INDIVIDUAL TO CONSUMER CREDIT REPORTING AGENCIES OR CREDIT BUREAUS; - DEFERRING, DENYING OR REQUIRING PAYMENT BEFORE PROVIDING MEDICALLY NECESSARY CARE BECAUSE OF AN INDIVIDUAL'S NONPAYMENT FOR PREVIOUSLY PROVIDED CARE; - PLACING A LIEN ON AN INDIVIDUAL'S PROPERTY; AND - GARNISHING AN INDIVIDUAL'S WAGES. CRMC MAY AUTHORIZE THIRD PARTIES TO INITIATE ECAS ON DELINQUENT PATIENT ACCOUNTS AFTER THE NOTIFICATION PERIOD. CAPE WILL ENSURE REASONABLE EFFORTS HAVE BEEN TAKEN TO DETERMINE WHETHER AN INDIVIDUAL IS ELIGIBLE FOR FINANCIAL ASSISTANCE UNDER THIS FAP. CAPE MUST TAKE THE FOLLOWING ACTIONS AT LEAST 30 DAYS PRIOR TO INITIATING ANY ECA: 1. THE PATIENT HAS BEEN PROVIDED WITH WRITTEN NOTICE WHICH: - INDICATES THAT FINANCIAL ASSISTANCE IS AVAILABLE FOR ELIGIBLE PATIENTS; - IDENTIFIES THE ECA(S) THAT CAPE INTENDS TO INITIATE TO OBTAIN PAYMENT FOR THE CARE; AND - STATES A DEADLINE AFTER WHICH SUCH ECAS MAY BE INITIATED. 2. THE PATIENT HAS RECEIVED A COPY OF THE PLS WITH THIS WRITTEN NOTIFICATION; AND 3. REASONABLE EFFORTS HAVE BEEN MADE TO ORALLY NOTIFY THE INDIVIDUAL ABOUT THE FAP AND HOW THE INDIVIDUAL MAY OBTAIN ASSISTANCE WITH THE FINANCIAL ASSISTANCE APPLICATION PROCESS. BAD DEBT WRITE-OFF ------------------ AFTER ALL THE COLLECTION PROCEDURES HAVE BEEN MET ALL OTHER ACCOUNTS EXCEPT, (1) SUBJECT TO PAYMENT PLANS (CONTRACTS); (2) THOSE FILED UNDER BANKRUPTCY; (3) MEDICAL DENIALS AND (4) COURTESY ALLOWANCES, WILL BE REVIEWED BY A MANAGER OR DIRECTOR AND A DETERMINATION WILL BE MADE WHETHER OR NOT TO HOLD THE ACCOUNT IN HOUSE OR FOR AN ADDITIONAL PERIOD OF TIME FOR FURTHER FOLLOW UP; SEND TO AN OUTSIDE COLLECTION AGENCY; OR PURSUE THROUGH APPROPRIATE LEGAL ACTION."

SCHEDULE H, PART VI; QUESTION 4
THIS ORGANIZATION IS IN A DIVERSE SUBURBAN LOCATION SERVING DIVERSE COMMUNITIES RANGING FROM LOW INCOME COMMUNITIES TO MORE AFFLUENT SUBURBAN AREAS, WHICH INCLUDE RESORT COMMUNITIES AT THE NEW JERSEY SHORE. THIS ORGANIZATION IS LOCATED IN CAPE MAY COURT HOUSE, IN CAPE MAY COUNTY. THIS ORGANIZATION IS COMMITTED TO SERVICE FOR ITS COMMUNITIES AND SERVES THE LOCAL POPULATION AS WELL AS THE NEEDS OF SUMMER VACATIONERS AND AN INFLUX OF LOW INCOME SUMMER WORKERS SERVING THOSE VACATIONERS. APPROXIMATELY 20% OF ITS PATIENTS CONSIST OF THE UNDERINSURED AND UNINSURED PAYER CATEGORIES. THE FOLLOWING COMMUNITY DEMOGRAPHICS WERE ALSO INCLUDED IN THE ORGANIZATION'S MOST RECENTLY CONDUCTED CHNA: - YEAR-ROUND POPULATION IS 95,404; - MAJOR INDUSTRY IS TOURISM: SUMMER SEASON POPULATION (MAY - SEPTEMBER) SWELLS TO OVER 800,000; - BREAKDOWN OF POPULATION: 85.8% CAUCASIAN, 4.52% AFRICAN AMERICAN AND 7.17% HISPANIC; - UNEMPLOYMENT RATE IS 22%; - POPULATION OVER 65 IS 22.1%; - POVERTY LEVEL IS 10.4%; AND - POVERTY LEVEL UNDER 18 YEARS OF AGE IS 19.6%.

SCHEDULE H, PART VI; QUESTION 5
THIS ORGANIZATION HOLDS A PUBLIC MEETING ATTENDED BY VARIOUS SENIOR MANAGEMENT AND BOARD MEMBERS OF CAPE REGIONAL MEDICAL CENTER. THE MAJORITY OF THE BOARD OF TRUSTEES ARE INDIVIDUALS WITH LOCAL BUSINESSES OR WHOM RESIDE IN THE COMMUNITY. MEDICAL CENTER STAFF MEMBERS SERVE ON THE BOARDS OF MANY LOCAL NOT-FOR-PROFIT ORGANIZATIONS AND PROVIDE OTHER FORMS OF SUPPORT (FUNDRAISING, ACTIVITY PARTICIPATION). ALL QUALIFIED PHYSICIANS ARE EXTENDED PRIVILEGES BY THEIR RESPECTIVE DEPARTMENTS. UNDER THE DIRECTIVE OF THE ORGANIZATION'S CORPORATE FINANCE OFFICE, SURPLUS FUNDS ARE UTILIZED FOR CAPITAL PROJECTS TO IMPROVE SERVICES OR PURCHASE EQUIPMENT WHICH IN TURN, BENEFIT THE COMMUNITY. PLEASE ALSO REFER TO FORM 990, SCHEDULE O, WHICH CONTAINS THE ORGANIZATION'S COMMUNITY BENEFIT STATEMENT.

SCHEDULE H, PART VI; QUESTION 6
"OUTLINED BELOW IS A SUMMARY OF THE ENTITIES WHICH COMPRISE THE CAPE REGIONAL HEALTH SYSTEM: CAPE REGIONAL HEALTH SYSTEM, INC. --------------------------------- CAPE REGIONAL HEALTH SYSTEM, INC. (""CRHS"") IS THE TAX-EXEMPT PARENT OF CAPE REGIONAL MEDICAL CENTER, INC. (""CRMC""). THIS INTEGRATED HEALTHCARE DELIVERY SYSTEM CONSISTS OF A GROUP OF AFFILIATED HEALTHCARE ORGANIZATIONS. THE SOLE MEMBER OR STOCKHOLDER OF EACH ENTITY IS EITHER CRMC OR CRHS. CAPE REGIONAL HEALTH SYSTEM, INC. IS AN ORGANIZATION RECOGNIZED BY THE INTERNAL REVENUE SERVICE AS TAX-EXEMPT PURSUANT TO INTERNAL REVENUE CODE 501(C)(3) AND AS A SUPPORTING ORGANIZATION PURSUANT TO INTERNAL REVENUE CODE 509(A)(3). CAPE REGIONAL MEDICAL CENTER, INC. ---------------------------------- CRMC IS A 242-BED NON-PROFIT ACUTE CARE MEDICAL CENTER LOCATED IN CAPE MAY COURT HOUSE, NEW JERSEY. CRMC IS RECOGNIZED BY THE INTERNAL REVENUE SERVICE AS AN INTERNAL REVENUE CODE 501(C)(3) TAX-EXEMPT ORGANIZATION. CRMC STRIVES TO CONTINUALLY DEVELOP AND OPERATE A HEALTHCARE SYSTEM WHICH PROVIDES SUBSTANTIAL COMMUNITY BENEFIT THROUGH THE PROVISION OF A COMPREHENSIVE SPECTRUM OF HEALTHCARE SERVICES TO THE RESIDENTS OF NEW JERSEY AND SURROUNDING COMMUNITIES. CRMC PROVIDES MEDICALLY NECESSARY HEALTHCARE SERVICES TO ALL INDIVIDUALS REGARDLESS OF RACE, COLOR, CREED, SEX, NATIONAL ORIGIN OR ABILITY TO PAY. NO INDIVIDUALS ARE DENIED NECESSARY MEDICAL CARE, TREATMENT OR SERVICES. CRMC OPERATES CONSISTENTLY WITH THE FOLLOWING CRITERIA OUTLINED IN IRS REVENUE RULING 69-545: 1. CRMC PROVIDES MEDICALLY NECESSARY HEALTHCARE SERVICES TO ALL INDIVIDUALS REGARDLESS OF ABILITY TO PAY, INCLUDING CHARITY CARE, SELF- PAY, MEDICARE AND MEDICAID PATIENTS; 2. CRMC OPERATES AN ACTIVE EMERGENCY DEPARTMENT FOR ALL PERSONS; WHICH IS OPEN 24 HOURS A DAY, 7 DAYS A WEEK, 365 DAYS PER YEAR; 3. CRMC MAINTAINS AN OPEN MEDICAL STAFF, WITH PRIVILEGES AVAILABLE TO ALL QUALIFIED PHYSICIANS; 4. CONTROL OF CRMC RESTS WITH ITS BOARD OF TRUSTEES AND THE BOARD OF TRUSTEES OF CAPE REGIONAL HEALTH SYSTEM. BOTH BOARDS ARE COMPRISED OF INDEPENDENT CIVIC LEADERS AND OTHER PROMINENT MEMBERS OF THE COMMUNITY; AND 5. SURPLUS FUNDS ARE USED TO IMPROVE THE QUALITY OF PATIENT CARE, EXPAND AND RENOVATE FACILITIES AND ADVANCE MEDICAL CARE; PROGRAMS AND ACTIVITIES. CAPE REGIONAL HOLDINGS, LLC --------------------------- CAPE REGIONAL HOLDINGS, LLC IS A SINGLE MEMBER LIMITED LIABILITY COMPANY WHOSE SOLE MEMBER IS CAPE REGIONAL HEALTH SYSTEM, INC. CAPE REGIONAL HOLDINGS, LLC MAINTAINS AND OPERATES CERTAIN HEALTHCARE RELATED RENTAL REAL ESTATE IN SUPPORT OF CAPE REGIONAL HEALTH SYSTEM. CAPE REGIONAL HEALTH ENTERPRISES, INC. AND SUBSIDIARIES ------------------------------------------------------- A CONSOLIDATED GROUP OF ENTITIES, CAPE CARDIOLOGY ASSOCIATES, INC. AND CAPE IMAGING SERVICES, INC., WHOSE PARENT IS CAPE REGIONAL HEALTH ENTERPRISES, INC. (""CRHE""). THESE ENTITIES ENGAGE IN VARIOUS HEALTHCARE RELATED BUSINESS ACTIVITIES IN FURTHERANCE OF THE CHARITABLE TAX-EXEMPT PURPOSES OF CAPE REGIONAL MEDICAL CENTER. THESE ENTITIES ARE LOCATED IN CAPE MAY COURT HOUSE, NEW JERSEY. CAPE REGIONAL PHYSICIAN ASSOCIATES, P.A. ---------------------------------------- CAPE REGIONAL PHYSICIAN ASSOCIATES, P.A. IS A MULTI-SPECIALTY MEDICAL GROUP CONTROLLED BY CAPE REGIONAL MEDICAL CENTER, INC. THROUGH A NOMINEE OWNERSHIP BY A LICENSED PROFESSIONAL DUE TO STATE OF NEW JERSEY CORPORATE PRACTICE OF MEDICINE PROHIBITION RULES AND REGULATIONS IN SUPPORT OF CAPE REGIONAL MEDICAL CENTER AND ITS CHARITABLE TAX-EXEMPT PURPOSES. CRPT MANAGEMENT SERVICES, LLC ------------------------------ CRPT MANAGEMENT SERVICES, LLC IS A LIMITED LIABILITY COMPANY TAXED AS A PARTNERSHIP OF WHICH CAPE REGIONAL HEALTH ENTERPRISES, INC. IS A 66.67% MEMBER. THIS ORGANIZATION IS LOCATED IN CAPE MAY COURT HOUSE AND PROVIDES MANAGEMENT SERVICES. CAPE REGIONAL MIRACLES FITNESS, LLC ----------------------------------- CAPE REGIONAL MIRACLES FITNESS, LLC IS A LIMITED LIABILITY COMPANY TAXED AS A PARTNERSHIP OF WHICH CAPE REGIONAL HEALTH ENTERPRISES, INC. IS AN 80% MEMBER. THIS ORGANIZATION PROVIDES HEALTH, WELLNESS AND FITNESS PROGRAMS TO CAPE MAY COUNTY RESIDENTS."