Form 990 for tax year 2022

Revenue

Part VIII, the statement of revenue.

• 1d · Related organizations

  $32,976,222

• 1e · Government grants (contributions)

  $18,854,108

• 2a · Program service revenue: NET PATIENT REVENUE

  total $2,446,091,494 · related or exempt $2,446,091,494

• 2b · Program service revenue: PHARMACY REVENUE

  total $53,539,523 · related or exempt $53,539,523

• 2c · Program service revenue: PROGRAM SERVICE FEES

  total $38,186,903 · related or exempt $38,186,903

• 2d · Program service revenue: FOOD SERVICES

  total $10,410,782 · related or exempt $10,410,782

• 2e · Program service revenue: ACO REVENUE

  total $9,906,345 · related or exempt $9,906,345

• 2f · All other program service revenue

  total $65,723,052 · related or exempt $65,723,052 · unrelated business $0 · excluded $0

• 3 · Investment income

  total $31,635,971 · unrelated business -$93,801 · excluded $31,729,772

• 4 · Income from investment of tax-exempt bond proceeds

  total $777,527 · excluded $777,527

• 6a · Gross rents

  real property $2,560,319

• 6c · Rental income or loss

  real property $2,560,319 · personal property $0

• 6d · Net rental income or loss

  total $2,560,319 · excluded $2,560,319

• 7a · Gross sales of assets other than inventory

  securities $462,606,502 · other assets $1,011,071

• 7b · Less cost or other basis and sales expenses

  securities $394,348,670

• 7c · Gain or loss

  securities $68,257,832 · other assets $1,011,071

• 7d · Net gain or loss

  total $69,268,903 · excluded $69,268,903

• 11a · Other revenue: ADMIN SERVICES

  total $232,096 · related or exempt $201,856 · unrelated business $30,240

• 11d · All other revenue

  total $0 · related or exempt $0 · unrelated business $0 · excluded $0

• 11e · Other revenue, total

  $232,096

Functional expenses

Part IX, the statement of functional expenses.

• 1 · Grants to domestic organizations and governments

  total $11,823,224 · program services $11,823,224

• 5 · Compensation of officers, directors and key employees

  total $15,895,828 · program services $0 · management and general $15,895,828 · fundraising $0

• 6 · Compensation of disqualified persons

  total $776,744 · program services $254,744 · management and general $522,000

• 7 · Other salaries and wages

  total $935,024,883 · program services $719,966,296 · management and general $215,058,587

• 8 · Pension plan contributions

  total $31,904,579 · program services $24,566,428 · management and general $7,338,151

• 9 · Other employee benefits

  total $128,520,227 · program services $98,960,181 · management and general $29,560,046

• 10 · Payroll taxes

  total $66,612,482 · program services $51,291,407 · management and general $15,321,075

• 11b · Fees: legal

  total $1,906,423 · management and general $1,906,423

• 11c · Fees: accounting

  total $1,135,682 · management and general $1,135,682

• 11d · Fees: lobbying

  total $310,240 · program services $310,240

• 11f · Fees: investment management

  total $2,282,575 · management and general $2,282,575

• 11g · Fees: other

  total $256,633,142 · program services $224,609,186 · management and general $32,023,956 · fundraising $0

• 12 · Advertising and promotion

  total $5,014,108 · program services $4,388,423 · management and general $625,685

• 13 · Office expenses

  total $19,493,143 · program services $17,060,692 · management and general $2,432,451

• 14 · Information technology

  total $57,164,279 · program services $50,031,037 · management and general $7,133,242

• 16 · Occupancy

  total $45,836,235 · program services $40,116,562 · management and general $5,719,673

• 17 · Travel

  total $1,158,331 · program services $1,013,789 · management and general $144,542

• 20 · Interest

  total $31,500,883 · program services $30,353,362 · management and general $1,147,521

• 22 · Depreciation, depletion and amortization

  total $120,563,474 · program services $88,820,817 · management and general $31,742,657

• 23 · Insurance

  total $20,156,476 · program services $17,641,251 · management and general $2,515,225

• 24a · Other expenses: MEDICAL SUPPLIES

  total $370,979,395 · program services $370,979,395

• 24b · Other expenses: PHARMACY SUPPLIES

  total $251,334,490 · program services $251,334,490

• 24c · Other expenses: PROVIDER TAX

  total $124,063,879 · program services $124,063,879

• 24d · Other expenses: REPAIRS & MAINTENANCE

  total $33,011,326 · program services $28,892,009 · management and general $4,119,317

• 24e · All other expenses

  total $50,288,197 · program services $44,012,986 · management and general $6,275,211 · fundraising $0

Balance sheet

Part X, book values.

• 2 · Savings and temporary cash investments

  beginning of year $502,145,902 · end of year $188,104,981

• 3 · Pledges and grants receivable

  beginning of year $7,562,091 · end of year $9,919,528

• 4 · Accounts receivable

  beginning of year $430,509,249 · end of year $501,755,019

• 5 · Loans and receivables from officers and key people

  beginning of year $0 · end of year $0

• 6 · Loans and receivables from disqualified persons

  beginning of year $0 · end of year $0

• 7 · Other notes and loans receivable

  beginning of year $17,994,322 · end of year $18,672,922

• 8 · Inventories for sale or use

  beginning of year $83,567,097 · end of year $79,369,064

• 9 · Prepaid expenses and deferred charges

  beginning of year $16,780,615 · end of year $25,323,753

• 10a · Land, buildings and equipment: cost or other basis

  $2,471,574,093

• 10b · Land, buildings and equipment: accumulated depreciation

  $1,499,026,763

• 10c · Land, buildings and equipment, net

  beginning of year $870,693,314 · end of year $972,547,330

• 11 · Investments: publicly traded securities

  beginning of year $910,661,901 · end of year $800,064,668

• 12 · Investments: other securities

  beginning of year $165,570,117 · end of year $146,543,366

• 13 · Investments: program-related

  beginning of year $85,555,418 · end of year $87,418,706

• 14 · Intangible assets

  beginning of year $10,000,991 · end of year $8,572,278

• 15 · Other assets

  beginning of year $409,366,993 · end of year $530,948,263

• 17 · Accounts payable and accrued expenses

  beginning of year $281,432,480 · end of year $278,052,001

• 19 · Deferred revenue

  beginning of year $34,312,298 · end of year $17,194,139

• 20 · Tax-exempt bond liabilities

  beginning of year $971,179,366 · end of year $943,483,671

• 22 · Loans and payables to officers and key people

  beginning of year $0 · end of year $0

• 25 · Other liabilities

  beginning of year $337,299,058 · end of year $243,287,254

• 27 · Net assets without donor restrictions

  beginning of year $1,879,085,498 · end of year $1,880,123,503

• 28 · Net assets with donor restrictions

  beginning of year $7,099,310 · end of year $7,099,310

The filer's explanations (Part III)

Schedule J, Part I, Line 1a Tax indemnification and gross-up payments

TAX GROSS-UP PAYMENTS - THESE ARE PAYMENTS FOR: 1) EMPLOYEES RECEIVING A TAXABLE AWARD, GIFT, OR GIFT CERTIFICATE; OR 2) GROUP TERM LIFE EXCESS BENEFIT OF $50,000. IT IS AVAILABLE TO ANY RANK OF EMPLOYEE.

Schedule J, Part I, Line 4a Severance or change-of-control payment

THE FOLLOWING INDIVIDUAL RECEIVED SEVERANCE PAY DURING 2021 (INCLUDED IN SCHEDULE J, PART II, COLUMN B(III)): WENDY CRAWFORD: $36,539

Schedule J, Part I, Line 4b Supplemental nonqualified retirement plan

HONORHEALTH OFFERS CERTAIN EXECUTIVES A NON QUALIFIED SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (SERP). IT IS INTENDED THAT THIS PLAN BE AN INELIGIBLE DEFERRED COMPENSATION PLAN UNDER THE PROVISIONS OF CODE SECTION 457(F) AND BE OPERATED IN COMPLIANCE WITH CODE SECTION 409A. THE DESIGN OF THE SERP IS SUCH THAT IT PROVIDES A MECHANISM FOR RESTORATION OF DEFERRED RETIREMENT THAT OTHERWISE WOULD BE LOST TO THE EXECUTIVES DUE TO MANDATORY CAP ON DEFERRALS WITHIN THE QUALIFIED RETIREMENT PLAN OFFERED TO OTHER EMPLOYEES OF HONORHEALTH. THE SERP IS ALSO DESIGNED TO DISCOURAGE EXECUTIVE TURNOVER, WHICH COULD HAMPER ORGANIZATIONAL STABILITY AND SUSTAINABILITY, THROUGH THE SERVICE REQUIREMENTS THAT AN EXECUTIVE MUST MEET IN ORDER TO RECEIVE BENEFITS FROM THIS PLAN. THE ANNUAL VALUE OF EACH EXECUTIVE'S PARTICIPATION IN THE PLAN IS TAKEN INTO CONSIDERATION AS PART OF THE CALCULATION OF TOTAL COMPENSATION WHEN TESTED AGAINST THE MARKET FOR REASONABLENESS. DEFERRED COMPENSATION, REPORTED IN SCHEDULE J, PART II, COLUMN (C), INCLUDES THE INCREASE IN VALUE OF THE SERP ACCOUNT, INCLUDING TAX DEFERRED CONTRIBUTIONS AND EARNINGS. THE FOLLOWING INDIVIDUALS EXPERIENCED A TAXABLE VESTING EVENT DURING THE YEAR AS FOLLOWS. THESE AMOUNTS WERE INCLUDED IN COLUMN (B)(III) AS TAXABLE WAGES. ANY PORTION OF THE DISTRIBUTION THAT WAS PREVIOUSLY REPORTED ON A PRIOR 990 AS DEFERRED HAS BEEN REPORTED IN COLUMN (F). TODD LAPORTE $152,708 LISA (REPLOGLE) MONTMAN $22,317 GARY BAKER $386,373 STEPHANIE JACKSON $105,910 JOHN NEIL, MD $128,210 KIMBERLY POST $108,618 DAVID PRICE $60,789 SHANNON FOX FRASER $33,245 ELIZABETH FARHART: $28,262

Schedule J, Part I, Line 7 Non-fixed payments

CERTAIN EXECUTIVES AND MANAGEMENT TEAM MEMBERS ARE ELIGIBLE FOR A SHORT AND LONG TERM INCENTIVE THAT IS BASED ON ORGANIZATIONAL AND INDIVIDUAL PERFORMANCE. PERFORMANCE IS DEFINED BY SET PARAMETERS AND GOALS THAT ARE APPROVED BY THE EXECUTIVE & COMPENSATION COMMITTEE OF THE BOARD OF DRIECTORS ("THE COMPENSATION COMMITTEE"). PLANS ARE ADMINISTERED BY THE COMPENSATION COMMITTEE WHO APPROVES ANY PAYOUTS UNDER THE PLANS. CERTAIN PHYSICIANS ARE ELIGIBLE FOR A BONUS BASED ON ORGANIZATIONAL AND INDIVIDUAL PERFORMANCE.

Disregarded entities

Part I: entities that legally are the filer and file no return of their own.

• HONORHEALTH MEDICAL GROUP

  PHYS PRACTICE · AZ · income $93,015,268 · assets $22,573,074

  Directly controlled by HH

• SCOTTSDALE HEALTH PARTNERS (DBA ICP)

  ACO · AZ · income $12,819,869 · assets $34,787,536

  Directly controlled by HH

Related partnerships

Part III: related organizations taxable as a partnership, with the filer's share.

• HONORHEALTH ASC LLC

  Related · HEALTHCARE · DE

  Directly controlled by HH AMBULATORY

• GLOBALREHAB-SCOTTSDALE LLC

  Related · HEALTHCARE · AZ · 51% owned · share of income $1,884,736 · share of assets $13,554,412

  Directly controlled by HH

• INTUITIVE HEALTH OF MARICOPA COUNTY LLC

  Related · HEALTHCARE · DE · 51% owned · share of income -$1,405,332 · share of assets $326,866

  Directly controlled by HH

• HONORHEALTH-FASTMED AMBULATORY HOLDINGS

  Related · HEALTHCARE · DE

  Directly controlled by HH AMBULATO RY

Related corporations and trusts

Part IV: related organizations taxable as a corporation or trust.

• HONORHEALTH CAPTIVE INSURANCE EXCHANGE

  C Corporation · CAPTIVE INS · CJ · 100% owned · share of income $6,556,347 · share of assets $89,586,592 · controlled entity

  Directly controlled by HH

• SCOTTSDALE HEALTHCARE MSO INC

  C Corporation · MSO · AZ · controlled entity

  Directly controlled by HH AMBULATORY

• SONORAN CROSSING OWNERS ASSOCIATION

  C Corporation · OWNERS ASSOC · AZ · 100% owned · share of income $0 · share of assets $0 · controlled entity

  Directly controlled by HH