4A (Expenses $ 51423721 including grants of $ 500) (Revenue $ 44575877)
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, SEXUAL ORIENTATION 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 3I
"PER INTERNAL REVENUE CODE SECTION 501(R), AN ORGANIZATION THAT BECOMES NEWLY SUBJECT TO THE REQUIREMENT OF IRC 501(R) BECAUSE IT IS RECOGNIZED AS DESCRIBED IN SECTION 501(C)(3) AND IS OPERATING A HOSPITAL FACILITY MUST MEET THE REQUIREMENT OF SECTION 501(R)(3) BY THE LAST DAY OF THE SECOND TAXABLE YEAR BEGINNING AFTER THE LATER OF THE EFFECTIVE DATE OF THE DETERMINATION LETTER OR THE FIRST DATE THAT A FACILITY OPERATED BY THE ORGANIZATION WAS LICENSED, REGISTERED OR SIMILARLY RECOGNIZED BY A STATE AS A HOSPITAL. SALEM MEDICAL CENTER WAS RECOGNIZED AS A HOSPITAL BY THE STATE OF NEW JERSEY WHEN IT BEGAN OPERATIONS EFFECTIVE FEBRUARY 1, 2019. THEREFORE, THE ORGANIZATION'S COMMUNITY HEALTH NEEDS ASSESSMENT (""CHNA"") WAS REQUIRED TO BE CONDUCTED EFFECTIVE DECEMBER 31, 2020. SINCE THE ORGANIZATION JUST COMPLETED ITS 1ST CHNA, THE REQUIREMENT TO INCLUDE THE IMPACT OF ANY ACTIONS TAKEN TO ADDRESS THE SIGNIFICANT HEALTH NEEDS IDENTIFIED IN THE HOSPITAL FACILITY'S PRIOR CHNA IS NOT APPLICABLE."

SCHEDULE H, PART V, SECTION B, QUESTION 5
THROUGH THE HELP OF COMMUNITY GROUPS, COMMUNITY MEMBERS TALKED ABOUT HEALTH IN THEIR COMMUNITIES WITH POTENTIAL CONCERNS. THE ORGANIZATION'S FOCUS ON COMMUNITY VOICE MEANS THAT ITS ASSESSMENT OF HEALTH NEEDS WERE FRAMED BY THE COMMUNITY'S PERCEPTION OF NEEDS. THESE COMMUNITY PERCEPTIONS ARE CONSISTENT WITH RECENT RESEARCH IN POPULATION HEALTH, WHICH SUGGESTS THAT TARGETED INTERVENTIONS IN THESE UPSTREAM DETERMINANTS COULD PROVIDE COST-SAVINGS AND IMPROVEMENTS IN HEALTH THAT ARE MUCH LARGER THAN EVEN THE BEST IMPROVEMENTS IN THE EFFICIENCY AND DELIVERY OF DIRECT CLINICAL CARE. IN PREPARATION FOR THE CHANGE OF OWNERSHIP STRUCTURE (WHICH TOOK PLACE IN FEBRUARY 2019), SMC LEADERSHIP MET EXTENSIVELY WITH THE STAKEHOLDERS LISTED BELOW. THE INPUT RECEIVED DURING THESE MEETINGS, AS WELL AS FROM SUBSEQUENT CONVERSATIONS POST CHANGE IN OWNERSHIP, PLAYED A SIGNIFICANT ROLE IN THE DEVELOPMENT OF THE SMC COMMUNITY HEALTH NEEDS ASSESSMENT. THE TIMING OF THE CHANGE IN OWNERSHIP WAS SOMEWHAT FORTUNATE, SINCE THE RESTRICTIONS ASSOCIATED WITH THE COVID-19 PANDEMIC LIMITED PERSONAL INTERACTION WITH COMMUNITY STAKEHOLDERS. ALTERNATE METHODS WERE UTILIZED (E.G., VIDEO CONFERENCING) IN 2020 TO CONTINUE TO ENGAGE WITH THE COMMUNITY IN LIGHT OF THE CHALLENGES POSED BY THE PANDEMIC. - NJ COMMISSIONER OF HEALTH - NJ DEPUTY COMMISSIONER OF HEALTH NJ SENATE PRESIDENT - NJ ASSEMBLYMAN FOR DISTRICT MAYOR OF SALEM NJ - SALEM COUNTY EXECUTIVE - THE LEADERSHIP OF THE SALEM HEALTH AND WELLNESS FOUNDATION - MEMBERS OF THE SMC MEDICAL STAFF - SMC EMPLOYEES - OTHER AREA HEALTHCARE SYSTEMS (COOPER HEALTH AND INSPIRA HEALTH) - LOCAL BUSINESS LEADERS PRIMARILY THROUGH MEMBERSHIP IN THE LOCAL CHAMBER OF COMMERCE - LOCAL RELIGIOUS LEADERS IN ADDITION, IN COMPLETING ITS CHNA, SALEM MEDICAL CENTER UTILIZED VARIOUS SECONDARY DATA SOURCES AND PUBLICLY AVAILABLE DATA, INCLUDING BUT NOT LIMITED TO: - RUTGERS CENTER FOR STATE HEALTH POLICY: IMPROVING HEALTH IN SALEM COUNTY FINAL REPORT - INSPIRA HEALTH NETWORK: COMMUNITY HEALTH NEEDS ASSESSMENT. - STUDY PERFORMED BY THE NEW JERSEY HEALTH CARE FINANCING AUTHORITY ON THE HEALTH NEEDS OF SALEM COUNTY. THESE REPORTS WHICH COVER THE SAME SERVICE AREA AS SALEM MEDICAL CENTER PROVIDED COMPREHENSIVE INFORMATION REGARDING COMMUNITY DEMOGRAPHICS AND IDENTIFIED COMMUNITY HEALTH NEEDS OF SALEM'S PRIMARY SERVICE AREA. THE REFERENCED REPORTS UTILIZED A MIXED METHODOLOGY OF PRIMARY AND SECONDARY DATA SOURCES TO OBTAIN THE REQUIRED INFORMATION.

SCHEDULE H, PART V, SECTION B, QUESTION 7A
"THE ORGANIZATION IS AN AFFILIATE WITHIN SALEM MEDICAL CENTER AND ITS AFFILIATE; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM (""SYSTEM""). DUE TO CHARACTER LIMITATIONS, THE WEBSITE LISTED IN SCHEDULE H, PART V, SECTION B, QUESTION 7A, IS THE HOME PAGE FOR THE SYSTEM. THE ORGANIZATION'S CHNA CAN BE ACCESSED BY CLICKING THE ""SMC COMMUNITY HEALTH NEEDS ASSESSMENT"" HYPERLINK WITHIN THE ""OUR VISION"" SECTION AT THE FOLLOWING PAGE INCLUDED IN THE SYSTEM'S WEBSITE: HTTPS://WWW.SMC.HEALTH/MISSION/"

SCHEDULE H, PART V, SECTION B, QUESTION 10A
"THE ORGANIZATION IS AN AFFILIATE WITHIN SALEM MEDICAL CENTER AND ITS AFFILIATE; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM (""SYSTEM""). DUE TO CHARACTER LIMITATIONS, THE WEBSITE LISTED IN SCHEDULE H, PART V, SECTION B, QUESTION 10A, IS THE HOME PAGE FOR THE SYSTEM. THE ORGANIZATION'S IMPLEMENTATION CAN BE ACCESSED BY CLICKING THE ""IMPLEMENTATION PLAN"" HYPERLINK WITHIN THE ""OUR VISION"" SECTION AT THE FOLLOWING PAGE INCLUDED IN THE SYSTEM'S WEBSITE: HTTPS://WWW.SMC.HEALTH/MISSION/"

SCHEDULE H, PART V, SECTION B, QUESTION 11
BASED ON THE INPUT OF COMMUNITY, KEY STAKEHOLDERS AND THE REVIEW OF RELEVANT HEALTH DATA FOR THE SMC SERVICE AREA, THE FOLLOWING WERE IDENTIFIED AS IMPORTANT HEALTHCARE ISSUES IN NEED OF ATTENTION AND ACTION: - OBESITY - SUBSTANCE ABUSE AND ADDICTION BEHAVIORAL HEALTH - SERVICES FOR INDIVIDUALS WITH INTELLECTUAL/DEVELOPMENTAL DISABILITIES - ACCESS TO CARE - INVESTMENT IN LOCAL HEALTHCARE - LOCAL RESPONSE TO THE COVID-19 PANDEMIC - WOMEN'S HEALTH SERVICES OBESITY ------- COMMUNITY MEMBERS RANKED OBESITY AS THEIR TOP HEALTH ISSUE. NATIONALLY, OBESITY IS ALSO A CONCERN, WITH HEALTH CARE COSTS AND MORTALITY RELATED TO OBESITY RAPIDLY OVERCOMING TOBACCO-RELATED COSTS/MORTALITY. SINCE 2000, THE ADULT OBESITY RATE IN NEW JERSEY HAS INCREASED BY OVER 60%. THIS PERIOD HAS ALSO SEEN AN INCREASE IN THE BURDEN OF OBESITY-RELATED DISEASES SUCH AS DIABETES, HYPERTENSION, AND HEART DISEASE. PROJECTIONS FOR THE CHRONIC DISEASE BURDEN RELATED TO OBESITY ARE DIRE, WITH AN EXPECTED FOUR-FOLD INCREASE IN THE NUMBER OF HEART DISEASE CASES WITHIN THE NEXT 20 YEARS. EVEN MORE TROUBLING IS THAT OBESITY AND RELATED CHRONIC HEALTH CONDITIONS OCCUR AT HIGHER RATES IN SOUTHERN NEW JERSEY THAN THEY DO IN THE REST OF THE STATE AND NATIONALLY. ACTION STEP: MEDICAL WEIGHT-MANAGEMENT THROUGH OUR FAMILY AND INTERNAL MEDICINE PRACTICES IS THE FIRST LINE OF DEFENSE IN HELPING CONTROL ONE'S WEIGHT. HOWEVER, BARIATRIC SURGERY REMAINS THE MOST EFFECTIVE AND DURABLE THERAPY OPTION FOR OBESITY. BARIATRIC SURGERY IS GENERALLY CONSIDERED WHEN NON-SURGICAL INTERVENTIONS HAVE FAILED IN A PATIENT WITH A BMI GREATER THAN 35-40. SMC MADE A MAJOR COMMITMENT IN THIS SPECIALTY BY BRINGING BACK ONE OF SOUTH JERSEY'S PREMIER BARIATRIC SURGEONS, DR. HARISH KAKKILAYA. WITH MORE THAN 20 YEARS OF EXPERIENCE, DR. KAKKILAYA HAS PERFORMED MORE THAN 1,000 WEIGHT LOSS SURGERIES AND HAS HAD BETTER RESULTS AND LESS COMPLICATIONS THAN THE NATIONAL AVERAGE. DR. KAKKILAYA'S REPUTATION - AND THE REASONABLE CASH PRICE OFFERED FOR THE SURGERY - GIVE SMC AN OPPORTUNITY TO MARKET THE SERVICE BEYOND THE TRADITIONAL SERVICE AREAS OF SMC - EVEN BEYOND THE SOUTH JERSEY REGION. SMC HAS THE CAPABILITY TO PROVIDE LIFE-CHANGING SURGERY TO THE COMMUNITY AS EVIDENCED BY THE MANY PERSONAL STORIES OF WEIGHT-LOSS SUCCESS. ADDICTION MEDICINE ------------------ COMMUNITY MEMBERS ARE CONCERNED ABOUT MULTIPLE TYPES OF SUBSTANCE ABUSE, PARTICULARLY THE OPIOID CRISIS THAT HAS PLAGUED THE UNITED STATES IN RECENT YEARS. ACCORDING TO THE CENTERS FOR DISEASE CONTROL, FROM 1999-2019, NEARLY 500,000 PEOPLE DIED FROM AN OVERDOSE INVOLVING ANY OPIOID, INCLUDING PRESCRIPTION AND ILLICIT OPIOIDS. INADEQUATE SERVICES AND FACILITIES WERE REPORTED TO HELP THOSE WITH SUBSTANCE ABUSE ISSUES. THE NEEDS ASSESSMENT REVEALED THAT INDIVIDUALS AND FAMILIES HAD A LACK OF RESOURCES AND SUPPORT AVAILABLE IN THEIR COMMUNITIES TO HELP THEM AND THEIR LOVED ONES BATTLE THIS ADDICTION. ACTION STEP: SMC PARTNERED WITH LEGACY TREATMENT SERVICES TO OPEN AN OUTPATIENT/INTENSIVE OUTPATIENT TREATMENT PROGRAM. ON THE GROUNDS OF THE MEDICAL CENTER, THEY OFFER EVIDENCE-BASED SERVICES THAT ARE DELIVERED BY A STAFF OF PSYCHIATRISTS, CLINICIANS, FAMILY THERAPISTS, ADDICTION SPECIALISTS, SOCIAL WORKERS, PEER SUPPORT SPECIALISTS, CARE COORDINATORS, AND ADVANCED PRACTICE NURSES. OUTPATIENT SERVICES FOR SUBSTANCE USE DISORDER INCLUDE: INDIVIDUAL AND GROUP COUNSELING, FAMILY COUNSELING, INDIVIDUAL AND GROUP THERAPY, THERAPY FOR CHILDREN AGE 13 AND UP, PSYCHIATRY AND MEDICATION MONITORING FOR ADULTS AND CHILDREN, SUBSTANCE ABUSE COUNSELING FOR ADULTS AND ADOLESCENTS, INTENSIVE OUTPATIENT TREATMENT FOR ADULTS WITH A SUBSTANCE USE DISORDER, AND INTENSIVE OUTPATIENT SERVICES FOR ADULTS WITH A CO-OCCURRING MENTAL HEALTH AND SUBSTANCE ABUSE DIAGNOSIS. IN ADDITION TO THE PARTNERSHIP WITH LEGACY, SMC INITIATED AN ER PROGRAM TO HELP REDUCE THE RISK OF OPIOID ABUSE. IN 2021, SMC LAUNCHED THE ADDICTION PATHWAYS PROGRAM - A MEDICATION-ASSISTED TREATMENT PROGRAM USING THE DRUG BUPRENORPHINE FOR OPIOID USE DISORDERS. BY IMPLEMENTING THIS PROGRAM, SMC HOPES TO REDUCE OPIOID USE AND OPIOID-RELATED DEATHS IN THE COMMUNITY. BEHAVIORAL HEALTH ----------------- COMMUNITY MEMBERS REPORTED THAT BEHAVIORAL HEALTH ISSUES WERE AFFECTING THEIR COMMUNITIES IN GENERAL, AND THEMSELVES SPECIFICALLY. INCREASED ACCESS TO BEHAVIORAL HEALTH TREATMENT WAS REPORTED AS AN IMPORTANT DELIVERABLE. ACTION STEP: SMC OPENED A NEW 26-BED INPATIENT PSYCHIATRIC UNIT. WORKING WITH BEHAVIORAL HEALTH EXPERTS, LAW ENFORCEMENT AND OTHER COMMUNITY LEADERS, SMC'S BOARD OF TRUSTEES COMMITTED ITSELF FULLY TO ADDRESS THE SALEM AREA'S NEED FOR ADDITIONAL MENTAL HEALTH RESOURCES. IN PARTNERSHIP WITH LEGACY TREATMENT SERVICES, SMC OFFERS OUTPATIENT MENTAL HEALTH TREATMENT PROVIDED ON THE GROUNDS OF THE MEDICAL CENTER USING A HIGHLY ORGANIZED TREATMENT APPROACH WHICH OFFERS MORE FREEDOM AND FLEXIBILITY THAN RESIDENTIAL INPATIENT CARE. SERVICES ARE PROVIDED BY A TREATMENT TEAM COMPRISED OF LICENSED PROFESSIONALS INCLUDING PSYCHIATRISTS, THERAPISTS, AND ADDICTION SPECIALISTS. THERAPIES AND SERVICES OFFERED AS PART OF OUR OUTPATIENT PROGRAM INCLUDE: PSYCHIATRIC EVALUATION AND ASSESSMENT, INDIVIDUAL AND GROUP THERAPY, FAMILY THERAPY, COUPLES THERAPY, MEDICATION MANAGEMENT, CO-OCCURRING SUBSTANCE USE DISORDER AND MENTAL HEALTH THERAPY. INTELLECTUAL/DEVELOPMENTAL DISABILITY ------------------------------------- PERSONS WITH INTELLECTUAL/DEVELOPMENTAL DISABILITY (IDD) EXPERIENCING A PSYCHIATRIC CRISIS NEED AN APPROPRIATE SETTING WITH A COMPREHENSIVE WRAP-AROUND SERVICES TO HELP PERSONS WITH IDD. NONE SUCH SETTING EXISTS FOR IDD PATIENTS IN SOUTH JERSEY. ACTION STEP: SMC WILL PARTNER WITH WOODS SERVICES AND LEGACY TREATMENT SERVICES, A LEADING SPECIALIST IN THE FIELD OF INTELLECTUAL/DEVELOPMENTAL DISABILITIES. SMC WILL ESTABLISH AN INPATIENT CRISIS STABILIZATION UNIT WITH WRAP-AROUND SERVICES TO HELP PERSONS WITH IDD. THE PROGRAM WILL PROVIDE SPECIALIZED STABILIZATION AND ONGOING CARE. THE GOAL OF THIS PROGRAM IS TO PLACE PATIENTS IN THE CORRECT CLINICAL SETTING. MOST TIMES THESE PATIENTS ARE MISPLACED AND FOUND IN MED/SURG UNITS AND NURSING HOMES, WHERE THE CARE SETTING IS NOT SUITED TO THEIR PRESENTING AND CHRONIC CONDITIONS. SMC WILL BE ABLE TO OFFER BETTER CARE MANAGEMENT WITH COORDINATED PRIMARY AND BEHAVIORAL HEALTH CARE. IN A WIN FOR THE COMMUNITY: NJ STATE SENATE PRESIDENT SWEENEY IS IN COMPLETE SUPPORT OF THE PROGRAM AND PASSED LEGISLATION TO SUPPORT IT. SMC HAS REQUESTED PROGRAM FUNDING OF $4.8 MILLION. NJ DEPARTMENT OF HEALTH ALSO SUPPORTS PROGRAM AND WILL ASSIST WITH ANY WAIVERS AS NEEDED. THE STATE OF NJ WILL BENEFIT FROM THE PROGRAM THROUGH COST SAVINGS OF APPROXIMATELY 15%. ACCESS TO CARE -------------- COMMUNITY MEMBERS' REPORTED ACCESS TO CARE WAS AN ISSUE THAT CREATED A BARRIER FOR THEM. GENERALLY, LACK OF FACILITIES AND PROVIDERS WERE A STRONG CONCERN FOR COMMUNITY MEMBERS IN SALEM AND SURROUNDING COUNTIES. ACTION STEP: SMC NOW OFFERS TELEMEDICINE AT EACH OF OUR LOCATIONS AS WELL AS SEVERAL WAYS TO ARRANGE A TELEMEDICINE VISIT TO ACCOUNT FOR INDIVIDUAL'S ACCESS OR LACK OF ACCESS TO TECHNOLOGY. TO HELP WITH ACCESS, SMC'S WOUND CARE WAS RELOCATED TO THE FRONT OF THE HOSPITAL AND HAS A NEW HOME AT THE FRONT OF THE FACILITY. THERE IS PUBLIC BUS TRANSPORTATION THAT HAS STOPS AT THE HOSPITAL. RECOGNIZING THAT SOME PATIENTS DO NOT HAVE THEIR OWN SOURCE OR ACCESS TO PUBLIC TRANSPORT, THE HOSPITAL DEVELOPED A PARTNERSHIP WITH A PRIVATE TRANSPORTATION SERVICE TO ARRANGE FOR THE APPROPRIATE LEVEL OF SERVICE (E.G. STANDARD SEDAN, VEHICLE WITH WHEELCHAIR LIFT) GIVEN THE PATIENT'S NEED. FINALLY, THE HOSPITAL CONTINUES TO ACTIVELY RECRUIT PHYSICIANS TO THE SALEM MEDICAL CENTER SERVICE AREA. THE PRIMARY FOCUS WILL BE TO FILL GAPS IN CLINICAL SERVICES AS NOTED IN THE COMMUNITY HEALTH NEEDS ASSESSMENT. THE RECRUITMENT OF PHYSICIANS WILL BE DEPENDENT ON THE AVAILABILITY OF FINANCIAL RESOURCES TO SUPPORT THE START-UP OF NEW PRACTICES. INVESTMENT IN LOCAL HEALTHCARE ------------------------------ THE NEED FOR IMPROVED MEDICAL TECHNOLOGY AND UPGRADED FACILITIES IS CAUSE FOR A SIGNIFICANT INVESTMENT INTO THE FUTURE OF SMC. ACTION STEP: TO CONTINUE PROVIDING HIGH QUALITY, COMPASSIONATE HEALTHCARE TO SALEM COUNTY AND BEYOND, SMC HAS SEEN IMPROVEMENTS IN FACILITIES, INFRASTRUCTURE, MEDICAL TECHNOLOGY AND HEALTHCARE UPGRADES. A SIGNIFICANT INVESTMENT HAS BEEN MADE IN SEVERAL AREAS INCLUDING: IMAGING AND RADIOLOGY TECHNOLOGY: 3D MAMMOGRAPHY, DEXA, NUCLEAR MEDICINE AND FULLY DIGITIZED RADIOLOGY SUITE; RELOCATION AND CONSTRUCTION OF BRAND-NEW WOUND CARE CENTER, WHICH INCLUDES A HYPERBARIC CHAMBER; CONSTRUCTION OF A 26-BED INPATIENT PSYCHIATRIC UNIT; ADDITION OF OUTPATIENT BEHAVIORAL HEALTH OFFICES; UPGRADED INFORMATION TECHNOLOGY INFRASTRUCTURE; AND RETRO-FIT 58 TELE/MED-SURG BEDS FOR NEGATIVE PRESSURE AND TELEMETRY. LOCAL RESPONSE TO THE COVID-19 PANDEMIC --------------------------------------- IN RESPONSE TO THE ESTIMATED POTENTIAL IMPACT

SCHEDULE H, PART V, SECTION B, QUESTION 16
"THE ORGANIZATION IS AN AFFILIATE WITHIN SALEM MEDICAL CENTER AND ITS AFFILIATE; A TAX-EXEMPT INTEGRATED HEALTHCARE DELIVERY SYSTEM (""SYSTEM""). DUE TO CHARACTER LIMITATIONS, THE WEBSITE LISTED IN SCHEDULE H, 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.SMC.HEALTH/PATIENT-TOOLS/"

SCHEDULE H, PART I; LINE 3C
"IN ADDITION TO THE FEDERAL POVERTY GUIDELINES, SALEM MEDICAL CENTER USES OTHER FACTORS IN DETERMINING ELIGIBILITY CRITERIA FOR FREE AND DISCOUNTED CARE. OTHER FACTORS TO DETERMINE ELIGIBILITY INCLUDE: - ASSET LEVEL; - MEDICAL INDIGENCY; - INSURANCE STATUS; - UNDERINSURANCE STATUS; AND - RESIDENCY. ADDITIONAL INFORMATION WITH RESPECT TO ELIGIBILITY CRITERIA FOR FINANCIAL ASSISTANCE IS OUTLINED BELOW. NEW JERSEY CHARITY CARE ----------------------- NJ CHARITY CARE IS FREE OR REDUCED CHARGE CARE WHICH IS PROVIDED TO PATIENTS WHO RECEIVE INPATIENT AND OUTPATIENT SERVICES AT ACUTE CARE HOSPITALS THROUGHOUT THE STATE OF NEW JERSEY. CHARITY CARE IS AVAILABLE ONLY FOR EMERGENT OR MEDICALLY NECESSARY HOSPITAL CARE. SOME SERVICES SUCH AS PHYSICIAN FEES, ANESTHESIOLOGY FEES, RADIOLOGY INTERPRETATION, AND OUTPATIENT PRESCRIPTIONS ARE SEPARATE FROM HOSPITAL CHARGES AND MAY NOT BE ELIGIBLE FOR REDUCTION. IN ACCORDANCE WITH CHARITY CARE GUIDELINES, PAYMENT ASSISTANCE IS AVAILABLE TO NEW JERSEY RESIDENT PATIENTS WHOSE HOUSEHOLD GROSS INCOME IS AT OR BELOW 300% OF THE FEDERAL POVERTY GUIDELINES AND WHO: 1. HAVE NO HEALTH COVERAGE OR HAVE COVERAGE THAT PAYS ONLY PART OF THE BILL; 2. ARE INELIGIBLE FOR ANY PRIVATE OR GOVERNMENTAL SPONSORED COVERAGE (SUCH AS MEDICAID): AND 3. MEET THE INCOME AND ASSETS CRITERIA DESCRIBED BELOW. CHARITY CARE IS AVAILABLE TO THOSE THAT DO NOT QUALIFY FOR STATE OR FEDERAL PROGRAMS. INCOME CRITERIA - PATIENTS WITH FAMILY GROSS INCOME LESS THAN OR EQUAL TO 200% OF THE FEDERAL POVERTY GUIDELINES (""FPG"") ARE ELIGIBLE FOR 100% CHARITY CARE COVERAGE. PATIENTS WITH FAMILY GROSS INCOME GREATER THAN 200% BUT LESS THAN OR EQUAL TO 300% OF FPG ARE ELIGIBLE FOR DISCOUNTED CARE UNDER THE CHARITY CARE PROGRAM. ASSETS CRITERIA - INDIVIDUAL ASSETS CANNOT EXCEED $7,500 AND FAMILY ASSETS CANNOT EXCEED $15,000. SHOULD AN APPLICANT'S ASSETS EXCEED THESE LIMITS, HE/SHE MAY ""SPEND DOWN"" THE ASSETS TO THE ELIGIBLE LIMITS THROUGH PAYMENT OF THE EXCESS TOWARD THE HOSPITAL BILL AND OTHER APPROVED OUT-OF-POCKET MEDICAL EXPENSES. CHARITY CARE MAY BE AVAILABLE TO NON-NEW JERSEY RESIDENTS, SUBJECT TO SPECIFIC PROVISIONS (SUCH AS EMERGENCY MEDICAL CONDITIONS). NEW JERSEY UNINSURED DISCOUNT CARE RATE --------------------------------------- UNINSURED NEW JERSEY STATE RESIDENT PATIENTS WHO DO NOT QUALIFY FOR CHARITY CARE AND WHOSE INCOME FALLS LESS THAN OR EQUAL TO 500% OF THE FEDERAL POVERTY GUIDELINES WILL BE ELIGIBLE FOR A DISCOUNT BASED UPON MEDICARE RATES AS PER THE NJ STATE STATUTE P.L. 2008, CHAPTER 60, APPROVED ON AUGUST 8, 2008, ASSEMBLY, NO. 2609, AS ENACTED BY THE SENATE AND GENERAL ASSEMBLY OF THE STATE OF NEW JERSEY. ADDITIONALLY, PLEASE NOTE THAT THIS ORGANIZATION OFFERS DISCOUNTED CARE TO ALL UNINSURED PATIENTS FOR EMERGENCY AND MEDICALLY NECESSARY CARE REGARDLESS OF INCOME. AMOUNT GENERALLY BILLED (""AGB"") ------------------------------- PER INTERNAL REVENUE CODE 501(R)(5) CHARGES FOR EMERGENCY OR OTHER MEDICALLY NECESSARY CARE FOR FAP-ELIGIBLE INDIVIDUALS UNDER SMC'S FAP WILL BE LIMITED TO BUT NOT BILLED MORE THAN THE AMOUNTS GENERALLY BILLED TO INDIVIDUALS WHO HAVE INSURANCE COVERING SUCH CARE."

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

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

SCHEDULE H, PART II
NOT APPLICABLE.

SCHEDULE H, PART III, SECTION B, QUESTION 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, 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 PATIENTS RE"

SCHEDULE H, PART VI, QUESTION 2
THE ORGANIZATION HAS CREATED A COMMUNITY HEALTH ADVISORY BOARD. THIS BOARD MEETS FREQUENTLY TO DISCUSS AND ASSESS THE HEALTHCARE NEEDS OF THE COMMUNITY SERVED BY THE ORGANIZATION.

SCHEDULE H, PART VI, QUESTION 3
"SALEM MEDICAL CENTER INFORMS AND EDUCATES PATIENTS WHO MAY BE BILLED FOR PATIENT CARE ABOUT ELIGIBILITY FOR FINANCIAL ASSISTANCE BY WIDELY PUBLICIZING THE AVAILABILITY OF FINANCIAL ASSISTANCE. THE AVAILABILITY OF FINANCIAL ASSISTANCE IS WIDELY PUBLICIZED IN THE FOLLOWING WAYS: - THE HOSPITAL'S FINANCIAL ASSISTANCE POLICY (""FAP"") FAP, APPLICATION FOR FINANCIAL ASSISTANCE AND PLAIN LANGUAGE SUMMARY (""PLS"") ARE ALL AVAILABLE ON-LINE AT THE FOLLOWING WEBSITE: WWW.SMC.HEALTH. - THE PLS IS OFFERED TO ALL RESPONSIBLE INDIVIDUALS AS PART OF THE INTAKE PROCESS. - THE HOSPITAL'S FAP, APPLICATION FOR FINANCIAL ASSISTANCE AND PLS ARE AVAILABLE IN ENGLISH, SPANISH AND IN THE PRIMARY LANGUAGE OF POPULATIONS WITH LIMITED PROFICIENCY IN ENGLISH THAT CONSTITUTE THE LESSER OF 1,000 INDIVIDUALS OR 5% OF THE COMMUNITY SERVED BY THE HOSPITAL'S PRIMARY SERVICE AREA. EVERY EFFORT WILL BE MADE TO ENSURE THAT THE FAP, APPLICATION FOR FINANCIAL ASSISTANCE AND PLS ARE CLEARLY COMMUNICATED TO RESPONSIBLE INDIVIDUALS WHOSE PRIMARY LANGUAGES ARE NOT INCLUDED AMONG THE AVAILABLE TRANSLATIONS. - PAPER COPIES OF THE FAP, APPLICATION FOR FINANCIAL ASSISTANCE AND PLS ARE AVAILABLE UPON REQUEST BY MAIL, WITHOUT CHARGE, AND ARE PROVIDED IN VARIOUS AREAS THROUGHOUT THE HOSPITAL FACILITIES INCLUDING ADMISSIONS DEPARTMENTS, EMERGENCY DEPARTMENTS, AND THE PATIENT ACCESS DEPARTMENT. APPLICATIONS FOR FINANCIAL ASSISTANCE CAN BE SUBMITTED IN PERSON, BY MAIL, BY FAX OR BY E-MAIL. - IF RESPONSIBLE INDIVIDUALS NEED ASSISTANCE OBTAINING PAPER COPIES OF THE FAP, THE APPLICATION FOR FINANCIAL ASSISTANCE OR THE PLS, OR IF THEY NEED OTHER ASSISTANCE, THEY CAN REACH THE PATIENT ACCESS DEPARTMENT AT (856)878-6894 OR VISIT THE PATIENT ACCESS DEPARTMENT. - SIGNS OR DISPLAYS THAT NOTIFY AND INFORM RESPONSIBLE INDIVIDUALS ABOUT THE AVAILABILITY OF FINANCIAL ASSISTANCE WILL BE CONSPICUOUSLY POSTED THROUGHOUT THE HOSPITAL, INCLUDING IN ADMISSIONS AREAS, OUTPATIENT CLINIC AREAS, THE EMERGENCY DEPARTMENT, AND THE PATIENT ACCESS DEPARTMENT. NOTICES WILL ALSO BE POSTED IN SPANISH. THE HOSPITAL IS COMMITTED TO OFFERING FINANCIAL ASSISTANCE TO ELIGIBLE PATIENTS WHO DO NOT HAVE THE ABILITY TO PAY FOR EMERGENCY AND OTHER MEDICALLY NECESSARY HEALTH CARE SERVICES IN WHOLE OR IN PART. IN ORDER TO ACCOMPLISH THIS CHARITABLE GOAL, THE HOSPITAL WILL WIDELY PUBLICIZE THIS FAP, THE APPLICATION FOR FINANCIAL ASSISTANCE AND THE PLS IN THE COMMUNITIES IT SERVES THROUGH COLLABORATIONS WITH LOCAL SOCIAL SERVICE AND NON-PROFIT AGENCIES. SMC'S PATIENT ACCESS DEPARTMENT PROVIDES ASSISTANCE TO PATIENTS WHO HAVE QUESTIONS OR WHO NEED HELP IN COMPLETING THE FINANCIAL AID APPLICATION AND, IF APPLICABLE, PROVIDES INFORMATION ON INSURANCE OPTIONS."

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

SCHEDULE H, PART III, SECTION A, QUESTIONS 2, 3 & 4
"SALEM MEDICAL CENTER AND ITS AFFILIATE PREPARE AND ISSUE AUDITED CONSOLIDATED FINANCIAL STATEMENTS. THE BELOW WAS OBTAINED FROM THE FOOTNOTES TO THE AUDITED FINANCIAL STATEMENTS OF THE SYSTEM. PATIENT ACCOUNTS RECEIVABLE --------------------------- PATIENT ACCOUNTS RECEIVABLE ARE RECORDED AT ESTABLISHED RATES NET OF PRICE CONCESSIONS, INCLUDING CONTRACTUAL ADJUSTMENTS AND DISCOUNTS AND DO NOT BEAR INTEREST. MANAGEMENT ASSESSES THE REASONABLENESS OF THE ACCOUNTS RECEIVABLE BASED ON HISTORICAL AND EXPECTED COLLECTIONS, BUSINESS ECONOMIC CONDITIONS, TRENDS IN HEALTHCARE COVERAGE AND OTHER COLLECTION INDICATORS. THE ALLOWANCE FOR DOUBTFUL ACCOUNTS WAS NOT SIGNIFICANT AT DECEMBER 31, 2021 AND 2020. NET PATIENT SERVICE REVENUE --------------------------- NET PATIENT SERVICE REVENUE IS REPORTED AT THE AMOUNT THAT REFLECTS THE CONSIDERATION TO WHICH THE MEDICAL CENTER EXPECTS TO BE ENTITLED IN EXCHANGE FOR PROVIDING PATIENT CARE, IN ACCORDANCE WITH ACCOUNTING STANDARDS CODIFICATION (""ASC"") 606. THESE AMOUNTS ARE DUE FROM PATIENTS, THIRD-PARTY PAYORS (INCLUDING HEALTH INSURERS AND GOVERNMENT PROGRAMS), AND OTHERS AND INCLUDE VARIABLE CONSIDERATION (REDUCTIONS TO REVENUE) IN DETERMINING A TRANSACTION PRICE. THE MEDICAL CENTER USES A PORTFOLIO APPROACH AS A PRACTICAL EXPEDIENT TO ACCOUNT FOR CATEGORIES OF PATIENT CONTRACTS AS COLLECTIVE GROUPS RATHER THAN RECOGNIZING REVENUE ON AN INDIVIDUAL CONTRACT BASIS. THE PORTFOLIOS CONSIST OF MAJOR PAYOR CLASSES FOR INPATIENT REVENUE AND MAJOR PAYOR CLASSES AND TYPES OF SERVICES PROVIDED FOR OUTPATIENT REVENUE. BASED ON HISTORICAL COLLECTION TRENDS AND OTHER ANALYSES, THE MEDICAL CENTER BELIEVES THAT REVENUE RECOGNIZED BY UTILIZING THE PORTFOLIO APPROACH APPROXIMATES THE REVENUE THAT WOULD HAVE BEEN RECOGNIZED IF AN INDIVIDUAL CONTRACT APPROACH WERE USED. THE MEDICAL CENTER'S INITIAL ESTIMATE OF THE TRANSACTION PRICE FOR SERVICES PROVIDED TO PATIENTS SUBJECT TO REVENUE RECOGNITION IS DETERMINED BY REDUCING THE TOTAL STANDARD CHARGES RELATED TO THE PATIENT SERVICES PROVIDED BY VARIOUS ELEMENTS OF VARIABLE CONSIDERATION, INCLUDING CONTRACTUAL ADJUSTMENTS, DISCOUNTS, IMPLICIT PRICE CONCESSIONS AND OTHER REDUCTIONS TO THE MEDICAL CENTER'S STANDARD CHARGES. THE MEDICAL CENTER DETERMINES THE TRANSACTION PRICE ASSOCIATED WITH SERVICES PROVIDED TO PATIENTS WHO HAVE THIRD-PARTY PAYOR COVERAGE ON THE BASIS OF CONTRACTUAL OR FORMULA-DRIVEN RATES FOR THE SERVICES RENDERED (SEE DESCRIPTION OF THIRD-PARTY PAYOR PAYMENT PROGRAMS BELOW). THE ESTIMATES FOR CONTRACTUAL ADJUSTMENTS AND DISCOUNTS ARE BASED ON CONTRACTUAL AGREEMENTS, THE MEDICAL CENTER'S DISCOUNT POLICIES AND HISTORICAL EXPERIENCE OF THEIR PREDECESSOR. FOR UNINSURED AND UNDER-INSURED PATIENTS WHO DO NOT QUALIFY FOR CHARITY CARE, THE MEDICAL CENTER DETERMINES THE TRANSACTION PRICE ASSOCIATED WITH THE SERVICES RENDERED ON THE BASIS OF CHARGES REDUCED BY AN IMPLICIT PRICE CONCESSION. GENERALLY, THE MEDICAL CENTER BILLS PATIENTS AND THIRD-PARTY PAYORS SEVERAL DAYS AFTER THE SERVICES ARE PERFORMED AND/OR THE PATIENT IS DISCHARGED. NET PATIENT SERVICE REVENUE IS RECOGNIZED AS PERFORMANCE OBLIGATIONS ARE SATISFIED. PERFORMANCE OBLIGATIONS ARE DETERMINED BASED ON THE NATURE OF THE SERVICES PROVIDED BY THE MEDICAL CENTER. NET PATIENT SERVICE REVENUE FOR PERFORMANCE OBLIGATIONS SATISFIED OVER TIME IS RECOGNIZED BASED ON ACTUAL CHARGES INCURRED IN RELATION TO TOTAL CHARGES. THE MEDICAL CENTER BELIEVES THAT THIS METHOD PROVIDES A REASONABLE DEPICTION OF THE TRANSFER OF SERVICES OVER THE TERM OF THE PERFORMANCE OBLIGATION BASED ON THE SERVICES NEEDED TO SATISFY THE OBLIGATION. ALL OF THE MEDICAL CENTER'S PERFORMANCE OBLIGATIONS ARE SATISFIED OVER TIME. THE MEDICAL CENTER MEASURES THE PERFORMANCE OBLIGATION FROM ADMISSION INTO THE MEDICAL CENTER OR THE COMMENCEMENT OF AN OUTPATIENT SERVICE TO THE POINT WHEN IT IS NO LONGER REQUIRED TO PROVIDE SERVICES TO THAT PATIENT, WHICH IS GENERALLY AT THE TIME OF DISCHARGE OR THE COMPLETION OF THE OUTPATIENT VISIT. SUBSTANTIALLY ALL OF ITS PERFORMANCE OBLIGATIONS RELATE TO CONTRACTS WITH A DURATION OF LESS THAN ONE YEAR. THE UNSATISFIED OR PARTIALLY UNSATISFIED PERFORMANCE OBLIGATIONS PRIMARILY RELATE TO INPATIENT ACUTE CARE SERVICES AT THE END OF THE REPORTING PERIOD FOR PATIENTS WHO REMAIN ADMITTED AT THAT TIME (IN-HOUSE PATIENTS). THE PERFORMANCE OBLIGATIONS FOR IN-HOUSE PATIENTS ARE GENERALLY COMPLETED WHEN THE PATIENTS ARE DISCHARGED, WHICH FOR THE MAJORITY OF THE MEDICAL CENTER'S IN-HOUSE PATIENTS OCCURS WITHIN DAYS OR WEEKS AFTER THE END OF THE REPORTING PERIOD. SUBSEQUENT CHANGES TO THE ESTIMATE OF THE TRANSACTION PRICE (DETERMINED ON A PORTFOLIO BASIS) ARE GENERALLY RECORDED AS ADJUSTMENTS TO PATIENT SERVICE REVENUE IN THE PERIOD OF THE CHANGE. PORTFOLIO COLLECTION ESTIMATES ARE UPDATED BASED ON COLLECTION TRENDS. SUBSEQUENT CHANGES THAT ARE DETERMINED TO BE THE RESULT OF AN ADVERSE CHANGE IN THE PATIENT'S ABILITY TO PAY (DETERMINED ON A PORTFOLIO BASIS) ARE RECORDED AS BAD DEBT EXPENSE. BAD DEBT EXPENSE FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 WAS NOT SIGNIFICANT. CONTRACT ASSETS ARE RELATED TO IN-HOUSE PATIENTS WHO WERE PROVIDED SERVICES DURING THE REPORTING PERIOD BUT WERE NOT DISCHARGED AS OF THE REPORTING DATE AND FOR WHICH THE MEDICAL CENTER DOES NOT HAVE THE RIGHT TO BILL. SETTLEMENTS WITH THIRD-PARTY PAYORS (SEE DESCRIPTION OF THIRD-PARTY PAYOR PAYMENT PROGRAMS BELOW) FOR COST REPORT FILINGS AND RETROACTIVE ADJUSTMENTS DUE TO ONGOING (CURRENTLY, NO ONGOING AUDITS) AND FUTURE AUDITS, REVIEWS OR INVESTIGATIONS ARE CONSIDERED VARIABLE CONSIDERATION AND ARE INCLUDED IN THE DETERMINATION OF THE ESTIMATED TRANSACTION PRICE FOR PROVIDING PATIENT CARE. THESE SETTLEMENTS ARE ESTIMATED BASED ON THE TERMS OF THE PAYMENT AGREEMENT WITH THE PAYOR, AND CORRESPONDENCE FROM THE PAYOR, INCLUDING AN ASSESSMENT TO ENSURE THAT IT IS PROBABLE THAT A SIGNIFICANT REVERSAL IN THE AMOUNT OF CUMULATIVE REVENUE RECOGNIZED WILL NOT OCCUR WHEN THE UNCERTAINTY ASSOCIATED WITH THE RETROACTIVE ADJUSTMENT IS SUBSEQUENTLY RESOLVED. ONCE THE MEDICAL CENTER HAS HISTORICAL SETTLEMENT ACTIVITY (FOR EXAMPLE, COST REPORT FINAL SETTLEMENTS OR REPAYMENTS RELATED TO RECOVERY AUDITS), THE ESTIMATE WILL ALSO BE BASED ON THAT HISTORICAL ACTIVITY. SUCH ESTIMATES ARE DETERMINED THROUGH EITHER A PROBABILITY-WEIGHTED ESTIMATE OR AN ESTIMATE OF THE MOST LIKELY AMOUNT, DEPENDING ON THE CIRCUMSTANCES RELATED TO A GIVEN ESTIMATED SETTLEMENT ITEM. ESTIMATED SETTLEMENTS WILL BE ADJUSTED IN FUTURE PERIODS AS ADJUSTMENTS BECOME KNOWN (THAT IS, NEW INFORMATION BECOMES AVAILABLE), OR AS YEARS ARE SETTLED OR ARE NO LONGER SUBJECT TO SUCH AUDITS, REVIEWS, AND INVESTIGATIONS."

SCHEDULE H, PART III, SECTION B, QUESTION 9B
"IT IS THE POLICY OF SALEM MEDICAL CENTER TO TREAT ALL PATIENTS, REGARDLESS OF THEIR ABILITY TO PAY FOR ALL EMERGENCY AND MEDICALLY NECESSARY HEALTHCARE SERVICES AND TO BILL AND COLLECT ACCOUNTS RECEIVABLE IN ACCORDANCE WITH ALL FEDERAL AND STATE BILLING AND COLLECTION REGULATIONS. ADDITIONALLY, THE ORGANIZATION'S BILLING AND COLLECTION POLICY DOES CONTAIN PROVISIONS ON THE COLLECTION PRACTICES TO BE FOLLOWED FOR PATIENTS WHO ARE KNOWN TO QUALIFY FOR FINANCIAL ASSISTANCE AS FURTHER OUTLINED BELOW. DEBT COLLECTION ACTIVITIES SHALL BE PROHIBITED FROM OCCURRING IN SMC'S EMERGENCY DEPARTMENT OR OTHER SMC VENUES WHERE SUCH ACTIVITIES COULD INTERFERE WITH THE TREATMENT OF EMERGENCY MEDICAL CONDITIONS WITHOUT DISCRIMINATION. IN ADDITION, THE HOSPITAL PROHIBITS COLLECTIONS AGAINST ANY PATIENT WHO IS ELIGIBLE FOR MEDICAID AT THE TIME SERVICES ARE RENDERED. THE HOSPITAL WILL NOT SEND AN ACCOUNT TO COLLECTION IF A FINANCIAL ASSISTANCE APPLICATION IS PENDING. THE HOSPITAL WILL BILL RESPONSIBLE INDIVIDUALS FOR ANY OUTSTANDING BALANCE AS SOON AS THE PATIENT BALANCE IS CONFIRMED. FOR UNINSURED PATIENTS, THE FIRST POST-DISCHARGE BILLING STATEMENT WILL MARK THE BEGINNING OF THE 120-DAY NOTIFICATION PERIOD IN WHICH NO EXTRAORDINARY COLLECTION ACTIONS (""ECA"") (DEFINED BELOW) MAY BE INITIATED AGAINST THE RESPONSIBLE INDIVIDUAL. FOR INSURED OR UNDERINSURED PATIENTS, THE FIRST POST- DISCHARGE BILLING STATEMENT REFLECTING PROCESSING BY AN INSURER WILL MARK THE BEGINNING OF THE 120-DAY NOTIFICATION PERIOD IN WHICH NO ECAS MAY BE INITIATED AGAINST THE RESPONSIBLE INDIVIDUAL (THE ""120-DAY NOTIFICATION PERIOD""). EACH BILLING STATEMENT WILL INCLUDE A CONSPICUOUS NOTICE REGARDING THE AVAILABILITY OF FINANCIAL ASSISTANCE, ALONG WITH A TELEPHONE NUMBER FOR THE HOSPITAL'S PATIENT FINANCIAL SERVICES OFFICE WHERE A PATIENT OR RESPONSIBLE INDIVIDUAL CAN RECEIVE INFORMATION ABOUT THE FAP AND ASSISTANCE WITH THE APPLICATION FOR FINANCIAL ASSISTANCE. THE BILLING STATEMENT WILL ALSO INCLUDE THE WEBSITE ADDRESS WHERE COPIES OF THE FAP, APPLICATION FOR FINANCIAL ASSISTANCE, AND PLS CAN BE OBTAINED. WHEN A RESPONSIBLE INDIVIDUAL IS DELINQUENT IN PAYMENT, A NOTICE WILL BE SENT TO THE RESPONSIBLE INDIVIDUAL OFFERING TO DISCUSS THE BILLING STATEMENT TO DETERMINE IF FINANCIAL ASSISTANCE OR A NEW OR REVISED PAYMENT PLAN IS NEEDED. THE HOSPITAL MAY ACCOMMODATE RESPONSIBLE INDIVIDUALS WHO REQUEST AND ESTABLISH PAYMENT PLANS. AT LEAST THREE (3) SEPARATE ACCOUNT STATEMENTS WILL BE MAILED TO THE LAST KNOWN ADDRESS OF EACH RESPONSIBLE INDIVIDUAL. AT LEAST 120 DAYS MUST ELAPSE BETWEEN THE FIRST POST- DISCHARGE BILL AND INITIATION OF ECAS. AT LEAST ONE OF THE STATEMENTS SENT DURING THIS TIME WILL INCLUDE WRITTEN NOTICE THAT INFORMS THE RESPONSIBLE INDIVIDUAL ABOUT THE ECAS THAT MAY BE TAKEN IF THE RESPONSIBLE INDIVIDUAL DOES NOT APPLY FOR FINANCIAL ASSISTANCE UNDER THE FAP OR PAY THE AMOUNT DUE BY THE BILLING DEADLINE. SUCH STATEMENT MUST BE PROVIDED TO THE RESPONSIBLE INDIVIDUAL AT LEAST 30 DAYS BEFORE THE DEADLINE SPECIFIED IN THE STATEMENT, IF COMMENCING ECAS. IF NO PAYMENT HAS BEEN RECEIVED AT THE END OF THE 120-DAY NOTIFICATION PERIOD AND A RESPONSIBLE INDIVIDUAL HAS NOT APPLIED FOR FINANCIAL ASSISTANCE OR ARRANGED WITH THE HOSPITAL'S PATIENT FINANCIAL SERVICES OFFICE FOR AN ALTERNATE PAYMENT PLAN, THE RESPONSIBLE INDIVIDUAL'S ACCOUNT WILL BE SUBJECT TO ECAS. EXTRAORDINARY COLLECTION ACTIONS (ECAS): ECA REFERS TO ANY ACTION AGAINST AN INDIVIDUAL RELATED TO OBTAINING PAYMENT SUCH AS SELLING AN INDIVIDUAL'S DEBT TO ANOTHER PARTY; REPORTING ADVERSE INFORMATION ABOUT THE RESPONSIBLE INDIVIDUAL TO CONSUMER CREDIT REPORTING AGENCIES OR CREDIT BUREAUS; DEFERRING OR DENYING OR REQUIRING A PAYMENT BEFORE PROVIDING MEDICALLY NECESSARY CARE BECAUSE OF AN INDIVIDUAL'S NONPAYMENT OF ONE OR MORE BILLS FOR PREVIOUS CARE COVERED UNDER THE HOSPITAL'S FAP; OR OTHER ACTIONS THAT REQUIRE A LEGAL OR JUDICIAL PROCESS INCLUDING: (A) PLACING A LIEN ON AN INDIVIDUAL'S PROPERTY (OTHER THAN A LIEN THAT THE HOSPITAL IS ENTITLED TO ASSERT UNDER STATE LAW ON THE PROCEEDS OF A JUDGMENT, SETTLEMENT, OR COMPROMISE OWED TO AN INDIVIDUAL (OR HIS OR HER REPRESENTATIVE) AS A RESULT OF PERSONAL INJURIES FOR WHICH THE HOSPITAL PROVIDED CARE); (B) FORECLOSING ON AN INDIVIDUAL'S REAL PROPERTY; (C) ATTACHING OR SEIZING AN INDIVIDUAL'S BANK ACCOUNT OR ANY OTHER PERSONAL PROPERTY; (D) COMMENCING A CIVIL ACTION AGAINST AN INDIVIDUAL; (E) CAUSING AN INDIVIDUAL'S ARREST; (F) CAUSING AN INDIVIDUAL TO BE SUBJECT TO A WRIT OF BODY ATTACHMENT; AND (G) GARNISHING AN INDIVIDUAL'S WAGES. ALL COLLECTION AGENCIES AFFILIATED WITH THE HOSPITAL HAVE A COPY OF AND MUST FOLLOW THE HOSPITAL'S FINANCIAL ASSISTANCE POLICY AND WILL REFER ANY RESPONSIBLE INDIVIDUAL NEEDING ASSISTANCE BACK TO THE HOSPITAL FOR EVALUATION AND REDUCTION OF A BILL BASED ON ANNUAL INCOME AND FAMILY SIZE. RESPONSIBLE INDIVIDUALS WILL RECEIVE A WRITTEN NOTICE 30 DAYS PRIOR TO ANY ACCOUNT BEING FORWARDED TO A COLLECTION AGENCY OR THE INITIATION OF ANY OTHER ECA. A REASONABLE EFFORT TO ORALLY NOTIFY THE RESPONSIBLE INDIVIDUAL BY TELEPHONE AT THE LAST KNOWN TELEPHONE NUMBER MUST ALSO BE MADE. DURING ALL CONVERSATIONS, THE RESPONSIBLE INDIVIDUAL WILL BE INFORMED ABOUT THE FINANCIAL ASSISTANCE THAT MAY BE AVAILABLE UNDER THE FAP. AFTER THE COMMENCEMENT OF ECAS IS PERMITTED, EXTERNAL COLLECTION AGENCIES SHALL BE AUTHORIZED TO FILE LITIGATION, OBTAIN JUDGMENT LIENS AND EXECUTE UPON SUCH JUDGMENT LIENS USING LAWFUL MEANS OF COLLECTION; PROVIDED, HOWEVER, THAT PRIOR WRITTEN APPROVAL FROM THE PATIENT FINANCIAL SERVICES DEPARTMENT SHALL BE REQUIRED BEFORE ANY LEGAL ACTION MAY BE INITIATED AND PRIOR APPROVAL OF THE PATIENT FINANCIAL SERVICES DEPARTMENT SHALL BE REQUIRED BEFORE COLLECTION AGENCIES MAY USE ANY MEANS OF COLLECTION THAT INVOLVES PHYSICAL DETENTION OR ARREST OF ANY RESPONSIBLE INDIVIDUAL. COLLECTION AGENCIES ARE PROHIBITED FROM FORCING THE SALE OF OR FORECLOSURE ON A RESPONSIBLE INDIVIDUAL'S PRIMARY RESIDENCE. IF THE HOSPITAL REFERS OR SELLS PATIENT DEBTS TO ANOTHER PARTY DURING THE APPLICATION PERIOD, THE WRITTEN AGREEMENT WITH SUCH PARTY MUST OBLIGATE SUCH PARTY TO: (A) REFRAIN FROM ENGAGING IN ECAS UNTIL THE BILLING DEADLINE; (B) SUSPEND ANY ECAS IF THE INDIVIDUAL SUBMITS A FAP APPLICATION DURING THE APPLICATION PERIOD; (C) IF THE RESPONSIBLE INDIVIDUAL IS DETERMINED TO BE FAP-ELIGIBLE, ENSURE THAT THE INDIVIDUAL DOES NOT PAY AND IS NOT OBLIGATED TO PAY MORE THAN REQUIRED, AND TO REVERSE ANY ECA PREVIOUSLY TAKEN; AND (D) OBTAIN SIMILAR PROVISIONS IN A WRITTEN AGREEMENT IF SUCH PARTY REFERS OR SELLS THE DEBT TO ANOTHER PARTY. IF AN INCOMPLETE APPLICATION FOR FINANCIAL ASSISTANCE IS RECEIVED, THE HOSPITAL WILL PROVIDE THE RESPONSIBLE INDIVIDUAL WITH WRITTEN NOTICE THAT DESCRIBES THE ADDITIONAL INFORMATION OR DOCUMENTATION REQUIRED TO MAKE A FAP-ELIGIBILITY DETERMINATION. THE HOSPITAL WILL INFORM THIRD PARTIES THAT AN INCOMPLETE APPLICATION FOR FINANCIAL ASSISTANCE WAS SUBMITTED AND THIRD PARTIES WILL SUSPEND ANY ECAS TO OBTAIN PAYMENT FOR CARE FOR A 30-DAY PERIOD. ONCE A COMPLETED APPLICATION FOR FINANCIAL ASSISTANCE IS RECEIVED, THE HOSPITAL WILL ENSURE THAT THE FOLLOWING WILL TAKE PLACE: - ECAS AGAINST THE RESPONSIBLE INDIVIDUAL WILL BE SUSPENDED; - AN ELIGIBILITY DETERMINATION WILL BE MADE AND DOCUMENTED IN A TIMELY MANNER; - THE HOSPITAL WILL NOTIFY THE RESPONSIBLE INDIVIDUAL IN WRITING OF THE DETERMINATION AND THE BASIS FOR THE DETERMINATION; - AN UPDATED BILLING STATEMENT WILL BE PROVIDED WHICH WILL INDICATE THE AMOUNT OWED BY THE FAP-ELIGIBLE RESPONSIBLE INDIVIDUAL (IF APPLICABLE), AND HOW THAT AMOUNT WAS DETERMINED; - IF APPLICABLE, ANY AMOUNTS PAID IN EXCESS OF THE AMOUNT OWED BY THE FAP- ELIGIBLE RESPONSIBLE INDIVIDUAL WILL BE REFUNDED ACCORDINGLY; AND - THIRD PARTIES WILL TAKE ALL REASONABLE AVAILABLE MEASURES TO REVERSE ANY ECAS TAKEN AGAINST THE RESPONSIBLE INDIVIDUALS TO COLLECT THE DEBT, SUCH AS VACATING A JUDGMENT OR LIFTING A LEVY OR LIEN."

SCHEDULE H, PART VI, QUESTION 4
SALEM MEDICAL CENTER IS LOCATED IN SALEM COUNTY. SALEM COUNTY IS LOCATED IN THE SOUTHWESTERN PART OF NEW JERSEY. IT IS BORDERED TO THE WEST BY THE DELAWARE RIVER, AND ITS GEOGRAPHY IS ALMOST ENTIRELY FLAT COASTAL PLAIN. THE COUNTY SEAT IS SALEM. SALEM COUNTY IS THE LEAST POPULATED OF THE 21 COUNTIES IN THE STATE OF NEW JERSEY BUT THE TENTH LARGEST COUNTY IN SQUARE MILES. THE COUNTY HAS BEEN SUCCESSFUL IN MAINTAINING THE CULTURAL HISTORY OF AGRICULTURE AND OPEN SPACE THAT HAS LONG DEFINED MUCH OF SOUTH JERSEY. TODAY, 42.6% OF THE LAND IS UNDER ACTIVE FARM CULTIVATION. THE COUNTY HAS 6 RIVERS, MORE THAN 34,000 ACRES OF MEADOW AND MARSHLAND, AND 40 LAKES AND PONDS. THE POPULATION OF SALEM COUNTY INCREASED 2.8% FROM 64,285 IN 2000 TO 66,083 IN 2010, BUT PROJECTIONS FROM THE 2010 CENSUS SUGGEST THAT THE POPULATION IS NOW DECLINING. THE TOP EMPLOYMENT SECTORS IN SALEM COUNTY ARE EDUCATION AND HEALTH CARE, WHICH REPRESENT 22.1% OF THE JOBS IN THE COUNTY. THE LARGEST EMPLOYER IS PSE&G, WITH ROUGHLY 1,300 EMPLOYEES. MOST SECTORS IN THE COUNTY HAVE PAYROLLS THAT ARE WELL BELOW THE STATE'S AVERAGE. HOWEVER, DUE TO THE PRESENCE OF PSE&G'S NUCLEAR FACILITY, THE TRADE, TRANSPORTATION, AND UTILITIES SECTORS PAY EMPLOYEES MORE THAN THEIR STATEWIDE COUNTERPARTS. IN TERMS OF PROJECTIONS FOR THE FUTURE, THE COUNTY IS EXPECTED TO EXPERIENCE A POPULATION GROWTH OF ONLY 1.5%, WHILE THE STATE'S POPULATION IS PROJECTED TO INCREASE BY 3.9%. EMPLOYMENT NUMBERS FOR SALEM COUNTY ARE PROJECTED TO REMAIN VIRTUALLY UNCHANGED SHOWING A SMALL GROWTH OF 0.1% PER YEAR. THIS IS PARTIALLY DUE TO LOSSES IN MANUFACTURING, UTILITIES, AND RETAIL TRADE THAT ARE EXPECTED TO OFFSET THE GROWTH EXPERIENCED IN CONSTRUCTION, HEALTH CARE AND SOCIAL SERVICES IN THIS AREA. IN SALEM COUNTY, THE PRELIMINARY UNEMPLOYMENT RATE IN APRIL 2018 WAS 5.3%, WHICH IS HIGHER THAN THE STATE'S RATE OF 4.1%. ESTIMATES INDICATE THAT FROM JANUARY 2014 TO APRIL 2018, THE UNEMPLOYMENT RATE IN SALEM COUNTY DROPPED FROM 9.8% TO 5.3%, AN APPROXIMATELY 46% DECREASE, SURPASSING THE STATE'S ESTIMATED DROP FROM 6.6% TO 4.1%, AN APPROXIMATELY 38% DECREASE. WHILE THE COUNTY'S OVERALL UNEMPLOYMENT RATE HAS CONTINUED TO DECREASE, IT CONTINUES TO BE HIGHER THAN THE STATE'S RATE. FURTHERMORE, THERE CONTINUE TO BE A NUMBER OF MUNICIPALITIES IN SALEM COUNTY WITH HIGH UNEMPLOYMENT RATES, INCLUDING SALEM (12.1%), PENNS GROVE (9.0%), AND CARNEY'S POINT (6.8%).

SCHEDULE H, PART VI, QUESTION 5
SALEM MEDICAL CENTER WAS INCORPORATED ON MARCH 28, 2018 UNDER NEW JERSEY LAW. THE MEDICAL CENTER WAS FORMED TO PROMOTE HEALTH IN THE CITY OF SALEM AND SURROUNDING AREAS, TO ENSURE THAT THE RESIDENTS OF SALEM COUNTY CONTINUE TO HAVE ACCESS TO CRITICALLY NEEDED HIGH QUALITY HEALTH CARE. OPERATION OF THE HOSPITAL IS IN FURTHERANCE OF ITS CHARITABLE PURPOSES OF PROMOTING HEALTH IN SALEM COUNTY. SALEM MEDICAL CENTER IS A PROVIDER OF GENERAL ACUTE HEALTHCARE SERVICES IN SALEM, NEW JERSEY AND IS RECOGNIZED BY THE IRS AS AN INTERNAL REVENUE CODE 501(C)(3) TAX-EXEMPT ORGANIZATION. PURSUANT TO ITS CHARITABLE PURPOSES, SMC PROVIDES HEALTHCARE SERVICES TO ALL INDIVIDUALS IN A NON-DISCRIMINATORY MANNER REGARDLESS OF RACE, COLOR, CREED, SEX, NATIONAL ORIGIN OR ABILITY TO PAY. MOREOVER, IT OPERATES CONSISTENTLY WITH THE FOLLOWING CRITERIA OUTLINED IN IRS REVENUE RULING 69-545: 1. PROVIDES HEALTHCARE SERVICES TO ALL INDIVIDUALS REGARDLESS OF ABILITY TO PAY, INCLUDING CHARITY CARE, SELF-PAY, MEDICARE AND MEDICAID PATIENTS; 2. OPERATES AN EMERGENCY DEPARTMENT FOR ALL PERSONS; WHICH IS OPEN 24 HOURS A DAY, 7 DAYS A WEEK, 365 DAYS PER YEAR; 3. MAINTAINS AN OPEN MEDICAL STAFF, WITH PRIVILEGES AVAILABLE TO ALL QUALIFIED PHYSICIANS; 4. CONTROL OF SALEM MEDICAL CENTER RESTS WITH ITS BOARD OF TRUSTEES WHICH IS 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. SURPLUS FUNDS ARE REINVESTED IN THE ORGANIZATION, PRINCIPALLY THROUGH CAPITAL INVESTMENT, AND ALSO TO MEET FUTURE PROGRAMMATIC NEEDS, WHICH MEETS THE ORGANIZATION'S COMMITMENT TO MEET THE EXPECTATIONS OF ITS PATIENTS BY PROVIDING QUALITY HEALTHCARE AND THEREFORE, MAKES THESE INVESTMENTS TO SECURE ITS FUTURE OF SERVICE DELIVERY TO THE COMMUNITY. THE OPERATIONS OF THE MEDICAL CENTER AS SHOWN THROUGH THE FACTORS OUTLINED ABOVE AND OTHER INFORMATION CONTAINED HEREIN, CLEARLY DEMONSTRATE THAT THE USE AND CONTROL IS FOR THE BENEFIT OF THE PUBLIC AND THAT NO PART OF THE INCOME OR NET EARNINGS OF THE ORGANIZATION INURES TO THE BENEFIT OF ANY PRIVATE INDIVIDUAL NOR IS ANY PRIVATE INTEREST BEING SERVED OTHER THAN INCIDENTALLY.

SCHEDULE H, PART VI; QUESTION 6
"OUTLINED BELOW IS A SUMMARY OF THE ENTITIES WHICH COMPRISE SALEM MEDICAL CENTER AND ITS AFFILIATES. SALEM COUNTY HOSPITAL CORP. -------------------------- SALEM COUNTY HOSPITAL CORP. D/B/A SALEM MEDICAL CENTER (""SMC"") IS RECOGNIZED BY THE INTERNAL REVENUE SERVICE AS AN INTERNAL REVENUE CODE SECTION 501(C)(3) TAX-EXEMPT ORGANIZATION. PURSUANT TO ITS CHARITABLE PURPOSES, SMC PROVIDES MEDICALLY NECESSARY HEALTHCARE SERVICES TO ALL INDIVIDUALS IN A NON-DISCRIMINATORY MANNER REGARDLESS OF RACE, COLOR, CREED, SEX, NATIONAL ORIGIN OR ABILITY TO PAY. MOREOVER, SMC OPERATES CONSISTENTLY WITH THE CRITERIA OUTLINED IN IRS REVENUE RULING 69-545. SALEM PHYSICIAN PRACTICES, P.C. ------------------------------- SALEM PHYSICIANS PRACTICES (""SPP"") IS A NOT-FOR-PROFIT CAPTIVE PROFESSIONAL CORPORATION WHICH CONSISTS OF 12 CLINICIANS, PRIMARILY SPECIALTY AND PRIMARY CARE PHYSICIANS IN SALEM AND GLOUCESTER COUNTIES. SPP IS RECOGNIZED BY THE INTERNAL REVENUE SERVICE AS AN INTERNAL REVENUE CODE SECTION 501(C)(3) TAX-EXEMPT ORGANIZATION."

SCHEDULE H: REVENUE PROCEDURE 2015-21
IN ACCORDANCE WITH REV PROC 2015-15, UNDER 1.501(R)-2(B) OF THE TREASURY REGULATIONS, A HOSPITAL FACILITY'S OMISSION OF REQUIRED INFORMATION FROM A REPORT OR POLICY DESCRIBED IN 1.501(R)-3 OR 1.501(R)-4, OR ERROR WITH RESPECT TO THE IMPLEMENTATION OR OPERATIONAL REQUIREMENTS DESCRIBED IN 1.501(R)-3 THROUGH 1.501(R)-6, WILL NOT BE CONSIDERED A FAILURE TO MEET A REQUIREMENT OF 501(R) IF: (1) SUCH OMISSION OR ERROR WAS MINOR AND EITHER INADVERTENT OR DUE TO REASONABLE CAUSE; AND (2) THE HOSPITAL FACILITY CORRECTS SUCH OMISSION OR ERROR AS PROMPTLY AFTER DISCOVERY AS IS REASONABLE GIVEN THE NATURE OF THE OMISSION OR ERROR. FOR PURPOSES OF THIS PROVISION, CORRECTION MUST INCLUDE THE ESTABLISHMENT (OR REVIEW AND, IF NECESSARY, REVISION) OF PRACTICES OR PROCEDURES (FORMAL OR INFORMAL) THAT ARE REASONABLY DESIGNED TO PROMOTE AND FACILITATE OVERALL COMPLIANCE WITH THE REQUIREMENTS OF 501(R). UNDER 1.501(R)-2(C), A HOSPITAL FACILITY'S FAILURE TO MEET THE REQUIREMENTS OF 1.501(R)-3 THROUGH 1.501(R)-6 THAT IS NEITHER WILLFUL NOR EGREGIOUS SHALL BE EXCUSED FOR PURPOSES OF 501(R)(1) AND 501(R)(2)(B) IF THE HOSPITAL FACILITY CORRECTS AND MAKES DISCLOSURE IN ACCORDANCE WITH RULES SET FORTH BY REVENUE PROCEDURE, NOTICE, OR OTHER GUIDANCE PUBLISHED IN THE INTERNAL REVENUE BULLETIN. DURING THE YEAR ENDED DECEMBER 31, 2021, SALEM MEDICAL CENTER IDENTIFIED AN EXCUSABLE FAILURE FOR NON-COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 501(R)(4),(5) & (6); RESPECTIVELY. THE FAILURE IDENTIFIED BY THE ORGANIZATION WAS NOT WILLFUL OR EGREGIOUS; HAS BEEN CORRECTED AND IS BEING DISCLOSED AS PROVIDED FOR UNDER IRS REVENUE PROCEDURE 2015-21. HOSPITAL PERSONNEL WERE UNDER A GOOD FAITH BELIEF THAT THE HOSPITAL COMPLIED WITH IRC 501(R)(4),(5) & (6) REGARDING ITS FINANCIAL ASSISTANCE POLICY, PLAIN LANGUAGE SUMMARY, FINANCIAL ASSISTANCE APPLICATION AND BILLING AND COLLECTION POLICY. UPON DISCOVERY THE HOSPITAL ORGANIZATION ACTED REASONABLY AND TIMELY IN ORDER TO CORRECT AND REMEDY THE EXCUSABLE FAILURE INCLUDING REVISING ITS POLICY, ENGAGING HEALTHCARE TAX PROFESSIONALS FOR ASSISTANCE AND PERFORMING A LOOK BACK TO THE 2019 YEAR TO ENSURE NO INDIVIDUALS ELIGIBLE FOR FINANCIAL ASSISTANCE UNDER THE ORGANIZATION'S FAP WAS HARMED AS A RESULT OF THEIR NON-COMPLIANCE. THE ORGANIZATION HAS MAINTAINED RECORDS DOCUMENTING ITS REVIEW. IN ADDITION, THE ORGANIZATION CORRECTED THE FOLLOWING AREA'S OF NON-COMPLIANCE: (1) A PROVIDER LISTING WAS ADDED AS APPENDIX A; (2) INCLUDED THE BASIS FOR AMOUNTS CHARGED TO PATIENTS, SPECIFICALLY IT'S LIMITATIONS ON CHARGES AND AMOUNTS GENERALLY BILLED METHODOLOGY. THE HOSPITAL'S REVISED FINANCIAL ASSISTANCE POLICY INCLUDES APPENDIX C WHICH OUTLINES THE ORGANIZATION'S CURRENT YEAR AMOUNTS GENERALLY BILLED PERCENTAGE BASED ON THE LOOK-BACK METHOD (MEDICARE-FEE-FOR-SERVICE AND ALL PRIVATE HEALTH INSURERS); (3) CREATED A PLAIN LANGUAGE SUMMARY; AND (4) ALL REQUIRED DOCUMENTS WERE MADE WIDELY AVAILABLE ON THE HOSPITAL'S WEBSITE. THE RESPONSIBILITY TO ENSURE 501(R) COMPLIANCE PROSPECTIVELY HAS BEEN JOINTLY DELEGATED TO THE ORGANIZATION'S CHIEF FINANCIAL OFFICER AND CONTROLLER WHICH INCLUDES A PREPARATION AND REVIEW FUNCTION BETWEEN THE TWO JOB RESPONSIBILITIES.