Form 990 for tax year 2024

Revenue

Part VIII, the statement of revenue.

• 1d · Related organizations

  $263,188

• 1e · Government grants (contributions)

  $778,583

• 1f · All other contributions, gifts and grants

  $699,426

• 2a · Program service revenue: INPATIENT AND OUTPATIENT REVENUES

  total $836,212,228 · related or exempt $835,100,814 · unrelated business $1,111,414

• 2b · Program service revenue: SKILLED NURSING FACILITY

  total $3,540,626 · related or exempt $3,540,626

• 3 · Investment income

  total $70,191 · excluded $70,191

• 6a · Gross rents

  real property $66,938

• 6b · Less rental expenses

  real property $0

• 6c · Rental income or loss

  real property $66,938

• 6d · Net rental income or loss

  total $66,938 · excluded $66,938

• 7a · Gross sales of assets other than inventory

  securities $889,996 · other assets $8,550

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

  securities $862,044 · other assets $15,594

• 7c · Gain or loss

  securities $27,952 · other assets -$7,044

• 7d · Net gain or loss

  total $20,908 · excluded $20,908

• 10a · Gross sales of inventory

  $290,727

• 10b · Cost of goods sold

  $125,560

• 10c · Net income from sales of inventory

  total $165,167 · unrelated business $154,615 · excluded $10,552

• 11a · Other revenue: MSA REVENUE-DULUTH FAMILY PRACTIC

  total $4,107,308 · related or exempt $4,107,308

• 11b · Other revenue: CAFETERIA REVENUE

  total $264,037 · excluded $264,037

• 11c · Other revenue: MEDICAL RECORDS

  total $104,667 · excluded $104,667

• 11d · All other revenue

  total $20,159 · unrelated business $5,340 · excluded $14,819

• 11e · Other revenue, total

  $4,496,171

Functional expenses

Part IX, the statement of functional expenses.

• 1 · Grants to domestic organizations and governments

  total $1,633,669 · program services $1,633,669

• 2 · Grants to domestic individuals

  total $1,529 · program services $1,529

• 5 · Compensation of officers, directors and key employees

  total $6,987,977 · program services $351,153 · management and general $6,636,824

• 7 · Other salaries and wages

  total $347,532,041 · program services $333,164,185 · management and general $14,367,856

• 8 · Pension plan contributions

  total $17,168,629 · program services $16,039,970 · management and general $1,128,659

• 9 · Other employee benefits

  total $34,805,825 · program services $32,280,180 · management and general $2,525,645

• 10 · Payroll taxes

  total $20,707,339 · program services $19,483,337 · management and general $1,224,002

• 11b · Fees: legal

  total $245,506 · management and general $245,506

• 11d · Fees: lobbying

  total $20,179 · program services $6,373 · management and general $13,806

• 11f · Fees: investment management

  total $5,754 · management and general $5,754

• 11g · Fees: other

  total $56,725,739 · program services $46,610,245 · management and general $10,115,494

• 12 · Advertising and promotion

  total $72,155 · program services $37,175 · management and general $34,980

• 13 · Office expenses

  total $15,243,235 · program services $9,051,207 · management and general $6,192,028

• 14 · Information technology

  total $43,237,191 · program services $41,592,930 · management and general $1,644,261

• 16 · Occupancy

  total $13,013,447 · program services $12,443,749 · management and general $569,698

• 17 · Travel

  total $1,701,808 · program services $1,558,209 · management and general $143,599

• 19 · Conferences, conventions and meetings

  total $816,168 · program services $445,515 · management and general $370,653

• 20 · Interest

  total $30,348,896 · program services $30,348,896

• 22 · Depreciation, depletion and amortization

  total $47,333,917 · program services $45,472,457 · management and general $1,861,460

• 23 · Insurance

  total $6,452,570 · program services $6,347,876 · management and general $104,694

• 24a · Other expenses: MEDICAL SUPPLIES

  total $109,485,755 · program services $109,485,755

• 24b · Other expenses: UNRELATED BUSINESS INCO

  total $120,360 · management and general $120,360

• 24c · Other expenses: AFFILIATE SUPPORT FEE

  total $83,685,237 · program services $40,763,079 · management and general $42,922,158

• 24d · Other expenses: BAD DEBT EXPENSE

  total $23,886,124 · program services $23,886,124

• 24e · All other expenses

  total -$32,458,278 · program services $18,184,881 · management and general -$50,643,159

Balance sheet

Part X, book values.

• 1 · Cash, non-interest-bearing

  beginning of year $6,709,795 · end of year $32,864,110

• 2 · Savings and temporary cash investments

  beginning of year $452,215 · end of year $243,246

• 3 · Pledges and grants receivable

  end of year $6,888

• 4 · Accounts receivable

  beginning of year $89,497,051 · end of year $99,776,075

• 7 · Other notes and loans receivable

  beginning of year $2,520,803 · end of year $3,279,810

• 8 · Inventories for sale or use

  beginning of year $22,606,747 · end of year $35,630,046

• 9 · Prepaid expenses and deferred charges

  beginning of year $15,065,737 · end of year $18,740,632

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

  $1,250,014,669

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

  $359,259,910

• 10c · Land, buildings and equipment, net

  beginning of year $910,011,939 · end of year $890,754,759

• 11 · Investments: publicly traded securities

  beginning of year $2,645 · end of year $12,693

• 12 · Investments: other securities

  beginning of year $2,681,928 · end of year $473,885

• 14 · Intangible assets

  beginning of year $63,000 · end of year $6,512,666

• 15 · Other assets

  beginning of year $26,280,491 · end of year $5,683,355

• 17 · Accounts payable and accrued expenses

  beginning of year $57,827,123 · end of year $64,626,934

• 19 · Deferred revenue

  beginning of year $279,266 · end of year $367,988

• 20 · Tax-exempt bond liabilities

  beginning of year $644,600,538 · end of year $646,044,584

• 21 · Escrow or custodial account liability

  beginning of year $18,660 · end of year $18,660

• 23 · Secured mortgages and notes payable

  beginning of year $1,702,274 · end of year $1,138,247

• 25 · Other liabilities

  beginning of year $131,890,213 · end of year $124,338,533

• 27 · Net assets without donor restrictions

  beginning of year $235,404,254 · end of year $257,211,378

• 28 · Net assets with donor restrictions

  beginning of year $4,170,023 · end of year $231,841

The filer's explanations (Part III)

PART I, LINE 3

ESTABLISHING CEO'S COMPENSATION: ESSENTIA HEALTH, AS A RELATED ORGANIZATION, USED THE FOLLOWING METHODS TO ESTABLISH ESSENTIA HEALTH DULUTH'S ADMINISTRATOR'S COMPENSATION: A COMPENSATION COMMITTEE, COMPENSATION SURVEY OR STUDY, AND APPROVAL BY THE BOARD OR COMPENSATION COMMITTEE.

PART I, LINES 4A-B

SEVERANCE PAYMENT: HIGHEST-COMPENSATED EMPLOYEE WILLIAM HEEGAARD, MD RECEIVED PAYMENTS TOTALING $393,086 IN CALENDAR YEAR 2024 RELATED TO A TERMINATION AGREEMENT. UNDER THE TERMS OF THE AGREEMENT, HEEGAARD WILL RECEIVE PAY TOTALING $1,095,026 AND BENEFITS TOTALING $45,337 FROM JUNE 2, 2024 TO DECEMBER 2, 2025. KEY EMPLOYEE JANICE SCHADE RECEIVED PAYMENTS TOTALING $266,083 IN CALENDAR YEAR 2024 RELATED TO A TERMINATION AGREEMENT. UNDER THE TERMS OF THE AGREEMENT, SCHADE WILL RECEIVE PAY TOTALING $576,514 AND BENEFITS TOTALING $24,526 FROM MARCH 29, 2024 TO SEPTEMBER 30, 2025. SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN: ESSENTIA HEALTH'S NONQUALIFIED RETIREMENT PLAN IS OFFERED TO DESIGNATED ESSENTIA HEALTH EXECUTIVES. THERE IS A MINIMUM FOUR YEAR VESTING DATE, OR VESTING IS AUTOMATIC UPON REACHING RETIREMENT AGE, DEATH, DISABILITY OR INVOLUNTARY TERMINATION WITHOUT CAUSE. BENEFITS ARE SUBJECT TO INCOME TAXES UPON VESTING AND PAYABLE FROM ESSENTIA HEALTH'S GENERAL ASSETS. REPORTED AS OTHER REPORTABLE COMPENSATION IN SCHEDULE J, PART II, COLUMN B (III), THE FOLLOWING INDIVIDUALS LISTED IN FORM 990, PART VII, SECTION A, LINE 1A RECEIVED PAYMENT OF THE VESTED BENEFIT FROM THE SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN DURING THE YEAR: TRACI MORRIS $78,928 BRADLEY BEARD $90,640 WILLIAM HEEGAARD, MD $112,499 MICHAEL WATTERS $62,797 RHONDA KAZIK $15,955 JANICE SCHADE $38,499 KEVIN BOREN $27,172 TAMMY KRITZER $36,428 ANNE STEPHEN, MD $65,980 REPORTED AS RETIREMENT AND OTHER DEFERRED COMPENSATION IN SCHEDULE J, PART II, COLUMN C, ESSENTIA HEALTH MADE CONTRIBUTIONS, SUBJECT TO THE VESTING TERMS, DURING THE YEAR INTO THE SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN ON BEHALF OF THE FOLLOWING INDIVIDUALS LISTED IN FORM 990, PART VII, SECTION A, LINE 1A: TRACI MORRIS $114,806 BRADLEY BEARD $106,959 WILLIAM HEEGAARD, MD $48,668 KRISTA SKORUPA, MD $91,234 JASON SCHULTZ, MD $85,394 MICHAEL WATTERS $84,801 RHONDA KAZIK $77,882 KEVIN BOREN $53,255 TAMMY KRITZER $60,450 ANNE STEPHEN, MD $32,992 TODD DEFREECE $49,684 TRENT NOBLES $42,232 ERIC NELSON $28,000

PART I, LINE 8

INITIAL CONTRACT EXCEPTION: ESSENTIA HEALTH DULUTH'S CHIEF MEDICAL OFFICER, JASON SCHULTZ, MD, AND ITS SENIOR VICE PRESIDENT OF OPERATIONS, ERIC NELSON, RECEIVED COMPENSATION DURING THE YEAR UNDER INITIAL EMPLOYMENT AGREEMENTS SUBJECT TO THE INITIAL CONTRACT EXCEPTION. THROUGH THE ESSENTIA HEALTH EXECUTIVE COMPENSATION COMMITTEE, THESE COMPENSATION ARRANGEMENTS WERE REVIEWED AND APPROVED BY INDEPENDENT PERSONS USING COMPARABILITY DATA; DELIBERATIONS AND DECISIONS WERE DOCUMENTED.

Disregarded entities

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

• ESSENTIA HEALTH VIRGINIA LLC

  HOSPITAL/CLINIC/SKILLED NURSING FACILITY · DE · income $160,037,510 · assets $71,959,889

  Directly controlled by SMDC MEDICAL CENTER

Related partnerships

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

• BRIGHTSIDE SURGICAL LLC

  N/A · AMBULATORY SURGERY CENTER · ND

Related corporations and trusts

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

• ESSENTIA HEALTH INSURANCE SERVICES SPC LTD

  C · SELF INSURANCE · CJ · controlled entity

• MID DAKOTA CLNIC INC

  C · CLINIC OPERATIONS CEASED 9/30/22 · ND · controlled entity