Form 990 for tax year 2023

Revenue

Part VIII, the statement of revenue.

• 1d · Related organizations

  $61,999

• 1e · Government grants (contributions)

  $1,200,000

• 2a · Program service revenue: NET PATIENT REVENUE

  total $102,982,760 · related or exempt $102,979,865 · unrelated business $2,895

• 2b · Program service revenue: SUPPORT PMTS FROM EXEMPT AFFILIAT

  total $10,015,136 · related or exempt $10,015,136

• 2c · Program service revenue: HEALTH EDUCATION PROGRAM

  total $9,434,666 · related or exempt $9,434,666

• 2d · Program service revenue: RETAIL PHARMACY

  total $1,932,850 · related or exempt $1,826,782 · unrelated business $106,068

• 2e · Program service revenue: CAFETERIA REVENUE

  total $390,592 · related or exempt $390,592

• 2f · All other program service revenue

  total $45,963 · related or exempt $35,613 · unrelated business $10,350

• 3 · Investment income

  total $877,511 · excluded $877,511

• 7a · Gross sales of assets other than inventory

  securities $1,475 · other assets $3,110

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

  securities $0 · other assets $0

• 7c · Gain or loss

  securities $1,475 · other assets $3,110

• 7d · Net gain or loss

  total $4,585 · excluded $4,585

Functional expenses

Part IX, the statement of functional expenses.

• 1 · Grants to domestic organizations and governments

  total $186,187 · program services $186,187

• 5 · Compensation of officers, directors and key employees

  total $1,693,799 · management and general $1,693,799

• 11b · Fees: legal

  total $69,515 · management and general $69,515

• 11c · Fees: accounting

  total $3,404 · management and general $3,404

• 11f · Fees: investment management

  total $3,818 · management and general $3,818

• 11g · Fees: other

  total $90,838,075 · program services $90,944,725 · management and general -$106,650

• 12 · Advertising and promotion

  total $3,841 · management and general $3,841

• 13 · Office expenses

  total $2,815,670 · program services $2,339,438 · management and general $476,232

• 14 · Information technology

  total $1,557,096 · program services $1,444,240 · management and general $112,856

• 16 · Occupancy

  total $2,950,099 · program services $2,950,099

• 17 · Travel

  total $63,199 · management and general $63,199

• 19 · Conferences, conventions and meetings

  total $26,854 · management and general $26,854

• 20 · Interest

  total $99,039 · program services $99,039

• 22 · Depreciation, depletion and amortization

  total $4,056,535 · program services $4,056,535

• 23 · Insurance

  total $1,552,813 · program services $769,499 · management and general $783,314

• 24a · Other expenses: MEDICAL SUPPLIES

  total $14,930,330 · program services $14,930,330

• 24b · Other expenses: STATE INDIGENT TAX ASSE

  total $7,016,612 · program services $7,016,612

• 24c · Other expenses: REPAIRS AND MAINTENANCE

  total $414,916 · program services $414,916

• 24d · Other expenses: UBI TAXES

  total $1,947 · management and general $1,947

• 24e · All other expenses

  total $257,913 · program services $57,113 · management and general $200,800

Balance sheet

Part X, book values.

• 1 · Cash, non-interest-bearing

  beginning of year $2,457 · end of year $2,225

• 2 · Savings and temporary cash investments

  beginning of year $11,388,968 · end of year $10,053,934

• 4 · Accounts receivable

  beginning of year $11,231,289 · end of year $12,380,172

• 8 · Inventories for sale or use

  beginning of year $2,516,491 · end of year $2,112,814

• 9 · Prepaid expenses and deferred charges

  beginning of year $572,101 · end of year $397,153

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

  $39,456,346

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

  $5,833,280

• 10c · Land, buildings and equipment, net

  beginning of year $35,648,102 · end of year $33,623,066

• 15 · Other assets

  beginning of year $13,817,624 · end of year $13,993,231

• 17 · Accounts payable and accrued expenses

  beginning of year $1,461,905 · end of year $1,660,560

• 25 · Other liabilities

  beginning of year $17,027,872 · end of year $15,330,379

• 27 · Net assets without donor restrictions

  beginning of year $56,687,255 · end of year $55,302,610

• 28 · Net assets with donor restrictions

  end of year $269,046

The filer's explanations (Part III)

PART I, LINE 1A

THE FILING ORGANIZATION'S PARENT IS OWNED 49% BY ADVENTIST HEALTH SYSTEM SUNBELT HEALTHCARE CORPORATION (AHSSHC). AHSSHC IS THE PARENT CORPORATION OF THE HEALTHCARE SYSTEM KNOWN AS ADVENTHEALTH. THE REMAINING 51% MEMBER IS THE UNIVERSITY OF CHICAGO MEDICAL CENTER (UCMC). BOTH AHSSHC AND UCMC ARE 501(C)(3) TAX-EXEMPT ORGANIZATIONS. EFFECTIVE JANUARY 1, 2023, THE FILING ORGANIZATION ENTERED INTO A MASTER MANAGEMENT AGREEMENT WITH AHSSHC WHEREBY AHSSHC SUPERVISES AND MANAGES THE DAY-TO-DAY OPERATIONS OF THE FILING ORGANIZATION. PURSUANT TO THE MASTER MANAGEMENT AGREEMENT, AHSSHC, AS MANAGER, PROVIDES THE CHIEF EXECUTIVE OFFICER (CEO), CHIEF OPERATING OFFICER (COO), CHIEF FINANCIAL OFFICER (CFO), CHIEF NURSING OFFICER (CNO), CHIEF MEDICAL OFFICER (CMO), AND THE CEO THE FILING ORGANIZATION. THE CEO OF THE FILING ORGANIZATION IS RESPONSIBLE FOR APPOINTING THE OTHER KEY MEMBERS OF HIS OR HER MANAGEMENT TEAM. THESE APPOINTED MEMBERS OF THE EXECUTIVE MANAGEMENT TEAM ARE SUPPLIED BY AHSSHC AS MANAGER AND ARE W-2 EMPLOYEES OF AHSSHC. AS THE ABOVE ENUMERATED C-SUITE PERSONNEL AND OTHER MEMBERS OF THE EXECUTIVE MANAGEMENT TEAM ARE PROVIDED TO THE FILING ORGANIZATION BY AHSSHC, THE COMPENSATION PRACTICES AND POLICIES OF AHSSHC ARE FOLLOWED BY THE FILING ORGANIZATION AND ITS SUBSIDIARIES. MEMBERS OF THE FILING ORGANIZATION'S EXECUTIVE MANAGEMENT TEAM THAT HOLD THE POSITION OF VICE-PRESIDENT OR ABOVE ARE COMPENSATED BY AND ON THE PAYROLL OF AHSSHC. AS AHSSHC IS NOT CONSIDERED A RELATED ORGANIZATION PURSUANT TO THE FORM 990 DEFINITIONS AND INSTRUCTIONS, COMPENSATION AND BENEFIT INFORMATION FOR THE FILING ORGANIZATION'S EXECUTIVE MANAGEMENT TEAM SHOWN ON PART VII IS BEING REPORTED FOR THAT PORTION OF EACH INDIVIDUAL'S COMPENSATION AND BENEFITS THAT IS PROVIDED IN EXCHANGE FOR SERVICES PROVIDED TO THE FILING ORGANIZATION AND ITS RELATED SUBSIDIARIES. FIRST-CLASS OR CHARTER TRAVEL: PURSUANT TO THE ADVENTHEALTH SYSTEM-WIDE GENERAL POLICY REGARDING BUSINESS TRAVEL, NO REIMBURSEMENT WILL BE PROVIDED FOR ANY ADDITIONAL COST INCURRED WITH RESPECT TO FIRST-CLASS OR CHARTER AIR TRAVEL BEYOND THE COST OF A REGULAR COACH AIRFARE. AS A MEANS OF PROVIDING ADDITIONAL BUSINESS TRAVEL REIMBURSEMENT FOR THOSE MEMBERS OF THE AHSSHC SENIOR EXECUTIVE MANAGEMENT TEAM THAT TRAVEL FREQUENTLY ON BEHALF OF ADVENTHEALTH, A SPECIAL ANNUAL TRAVEL ALLOWANCE IS PROVIDED FOR THOSE EXECUTIVES. AS ADVENTHEALTH OPERATES 50 HOSPITALS IN 9 STATES, THE SENIOR LEADERSHIP OF AHSSHC TRAVEL EXTENSIVELY AND OFTEN VISIT MULTIPLE HOSPITAL LOCATIONS IN DIFFERENT STATES AS A PART OF A SINGLE BUSINESS TRIP. THE SPECIAL TRAVEL ALLOWANCE CAN PROVIDE REIMBURSEMENTS TO THE EXECUTIVE FOR SUCH ITEMS AS THE PURCHASE OF AIR TRAVEL UPGRADE COUPONS, TO COVER THE COST DIFFERENTIAL BETWEEN COACH AND FIRST-CLASS TRAVEL, OR TO COVER THE COST OF A CHARTER FLIGHT. THE SPECIAL TRAVEL ALLOWANCE BENEFIT WAS ORIGINALLY AUTHORIZED BY AND CODIFIED INTO A POLICY BY THE AHSSHC BOARD COMPENSATION COMMITTEE (THE COMMITTEE), AN INDEPENDENT BODY OF THE AHSSHC BOARD OF DIRECTORS, WHO ALSO APPROVES THE ANNUAL CAP ON THE AMOUNT OF THE ALLOWANCE. THE SPECIAL TRAVEL ALLOWANCE HAS AN ANNUAL CAP OF $24,000 FOR MEMBERS OF THE LEADERSHIP EXECUTIVE TEAM (15 ADVENTHEALTH CABINET MEMBERS AND THE ADVENTHEALTH MULTI-STATE CFO) AND $15,000 FOR ADVENTHEALTH CORPORATE OFFICE SENIOR VICE PRESIDENTS, REGIONAL CEO'S, AND DIVISION CHIEF OFFICERS (GENERALLY 45-55 INDIVIDUAL EXECUTIVES). THE REGIONAL CEO/BOARD MEMBER LISTED ON PART VII OF THE FILING ORGANIZATION'S FORM 990 IS ON THE PAYROLL OF AHSSHC AND IS PROVIDED TO THE FILING ORGANIZATION PURSUANT TO THE MASTER MANAGEMENT SERVICES AGREEMENT. WHILE THE SPECIAL TRAVEL ALLOWANCE BENEFIT IS AN AHSSHC COMPENSATION POLICY AND PRACTICE, THE COST OF PROVIDING THIS BENEFIT IS CHARGED TO AND REIMBURSED BY THE FILING ORGANIZATION. ACCORDINGLY, THE FILING ORGANIZATION HAS CHECKED THE BOX IN SCHEDULE J, PART I, LINE 1A FOR FIRST-CLASS OR CHARTER TRAVEL SINCE IT HAS PAID FOR THE COST OF PROVIDING THIS BENEFIT. THOSE EXECUTIVES WHO RECEIVE THE SPECIAL TRAVEL ALLOWANCE ARE RESPONSIBLE FOR TRACKING THE EXPENSES REIMBURSABLE UNDER THE SPECIAL TRAVEL ALLOWANCE AND MUST SUBMIT SUCH EXPENSES ON THEIR ACCOUNTABLE PLAN EXPENSE REPORT. A REPORT ON CHARTER TRAVEL IS PROVIDED TO THE AHSSHC BOARD COMPENSATION COMMITTEE AT EACH MEETING. ANY TAXABLE REIMBURSEMENTS MADE TO EXECUTIVES UNDER THE SPECIAL TRAVEL ALLOWANCE ARRANGEMENT ARE TREATED AS TAXABLE COMPENSATION TO THE EXECUTIVE. TRAVEL FOR COMPANIONS: AHSSHC HAS A CORPORATE EXECUTIVE POLICY THAT PROVIDES A BENEFIT TO ALLOW FOR A TRAVELING AHSSHC EXECUTIVE TO HAVE HIS OR HER SPOUSE ACCOMPANY THE EXECUTIVE ON CERTAIN BUSINESS TRIPS EACH YEAR. TYPICALLY, REIMBURSEMENT IS ONLY PROVIDED TO CERTAIN EXECUTIVE LEADERS AND IS USUALLY LIMITED TO ONE BUSINESS TRIP PER YEAR BEYOND THE ANNUAL ADVENTHEALTH PRESIDENT'S COUNCIL BUSINESS MEETING AND OTHER MEETINGS WHERE THE SPOUSE IS SPECIFICALLY INVITED. THE AHSSHC CORPORATE EXECUTIVE SPOUSAL TRAVEL POLICY WAS ORIGINALLY APPROVED AND REVIEWED BY THE AHSSHC BOARD COMPENSATION COMMITTEE, AN INDEPENDENT BODY OF THE AHSSHC BOARD OF DIRECTORS. ALL SPOUSAL TRAVEL COSTS REIMBURSED TO THE EXECUTIVE ARE CONSIDERED TAXABLE COMPENSATION TO THE EXECUTIVE. TAX INDEMNIFICATION AND GROSS-UP PAYMENTS: ADVENTHEALTH HAS A SYSTEM-WIDE POLICY ADDRESSING GROSS-UP PAYMENTS PROVIDED IN CONNECTION WITH EMPLOYER-PROVIDED BENEFITS/OTHER TAXABLE ITEMS. UNDER THE POLICY, CERTAIN TAXABLE BUSINESS-RELATED REIMBURSEMENTS (I.E. TAXABLE BUSINESS-RELATED MOVING EXPENSES, TAXABLE ITEMS PROVIDED IN CONNECTION WITH EMPLOYMENT) PROVIDED TO ANY EMPLOYEE MAY BE GROSSED-UP AT A 25% RATE UPON APPROVAL BY THE FILING ORGANIZATION'S CEO AND CFO. ADDITIONALLY, EMPLOYEES AT THE DIRECTOR LEVEL AND ABOVE ARE ELIGIBLE FOR GROSS-UP PAYMENTS ON GIFTS RECEIVED FOR BOARD OF DIRECTOR SERVICES. DISCRETIONARY SPENDING ACCOUNT: OCCASIONAL DISCRETIONARY SPENDING AMOUNTS ARE PERIODICALLY PROVIDED TO ELIGIBLE EXECUTIVES WHO ATTEND ANNUAL BUSINESS MEETINGS SUCH AS THE ADVENTHEALTH PRESIDENT'S COUNCIL, CFO CONFERENCE OR THE CMO/CNO BUSINESS MEETING. PAYMENTS PROVIDED TO EACH EXECUTIVE ARE CONSIDERED TAXABLE COMPENSATION TO THE EXECUTIVE.

PART I, LINE 3

THE INDIVIDUAL WHO SERVES AS THE CEO OF THE FILING ORGANIZATION IS COMPENSATED BY ADVENTIST HEALTH SYSTEM SUNBELT HEALTHCARE CORPORATION (AHSSHC), AN UNRELATED ENTITY AS DISCLOSED IN OUR RESPONSE TO FORM 990, SCHEDULE J, PART I, LINE 1A, FOR THAT INDIVIDUAL'S ROLE IN SERVING AS THE CEO PURSUANT TO THE MASTER MANAGEMENT AGREEMENT BETWEEN AHSSHC AND UCMC. COMPENSATION AND BENEFITS PROVIDED TO THIS INDIVIDUAL ARE DETERMINED PURSUANT TO POLICIES, PROCEDURES, AND PROCESSES OF AHSSHC THAT ARE DESIGNED TO ENSURE COMPLIANCE WITH THE INTERMEDIATE SANCTIONS LAWS AS SET FORTH IN IRC SECTION 4958. AHSSHC HAS TAKEN STEPS TO ENSURE THAT PROCESSES ARE IN PLACE TO SATISFY THE REBUTTABLE PRESUMPTION OF REASONABLENESS STANDARD AS SET FORTH IN TREASURY REGULATION SECTION 53.4958-6 WITH RESPECT TO ITS ACTIVE EXECUTIVE-LEVEL POSITIONS. THE AHSSHC BOARD COMPENSATION COMMITTEE (THE COMMITTEE) SERVES AS THE GOVERNING BODY FOR ALL EXECUTIVE COMPENSATION MATTERS. THE COMMITTEE IS COMPOSED OF CERTAIN MEMBERS OF THE BOARD OF DIRECTORS (THE BOARD) OF AHSSHC. VOTING MEMBERS OF THE COMMITTEE INCLUDE ONLY INDIVIDUALS WHO SERVE ON THE BOARD AS INDEPENDENT REPRESENTATIVES, WHO HOLD NO EMPLOYMENT POSITIONS WITH AHSSHC AND WHO DO NOT HAVE RELATIONSHIPS WITH ANY OF THE INDIVIDUALS WHOSE COMPENSATION IS UNDER THEIR REVIEW THAT IMPACTS THEIR BEST INDEPENDENT JUDGMENT AS FIDUCIARIES OF AHSSHC. THE COMMITTEE'S ROLE IS TO REVIEW AND APPROVE ALL COMPONENTS OF THE EXECUTIVE COMPENSATION PLAN OF AHSSHC. AS AN INDEPENDENT GOVERNING BODY WITH RESPECT TO EXECUTIVE COMPENSATION, IT SHOULD BE NOTED THAT THE COMMITTEE WILL OFTEN CONFER IN EXECUTIVE SESSIONS ON MATTERS OF COMPENSATION POLICY AND POLICY CHANGES. IN SUCH EXECUTIVE SESSIONS, NO MEMBERS OF MANAGEMENT OF AHSSHC ARE PRESENT, OTHER THAN THE CHIEF PEOPLE OFFICER, WHO REMAINS AT THE REQUEST OF THE CHAIRMAN/COMMITTEE TO PROVIDE ASSISTANCE/INFORMATION AS NEEDED. THE COMMITTEE IS ADVISED BY AN INDEPENDENT THIRD-PARTY COMPENSATION ADVISOR. THIS ADVISOR PREPARES ALL THE BENCHMARK STUDIES FOR THE COMMITTEE. COMPENSATION LEVELS ARE BENCHMARKED WITH A NATIONAL PEER GROUP OF OTHER NOT-FOR-PROFIT HEALTHCARE SYSTEMS AND HOSPITALS OF SIMILAR SIZE AND COMPLEXITY TO ADVENTHEALTH AND EACH OF ITS AFFILIATED ENTITIES. THE FOLLOWING PRINCIPLES GUIDE THE ESTABLISHMENT OF INDIVIDUAL EXECUTIVE COMPENSATION: - THE SALARY OF THE PRESIDENT/CEO OF ADVENTHEALTH WILL NOT EXCEED THE 50TH PERCENTILE OF COMPARABLE SALARIES PAID BY SIMILARLY SITUATED ORGANIZATIONS; AND - OTHER EXECUTIVE SALARIES SHALL BE ESTABLISHED USING MARKET MEDIANS. THE COMPENSATION PHILOSOPHY, POLICIES, AND PRACTICES OF AHSSHC ARE CONSISTENT WITH THE ORGANIZATION'S FAITH-BASED MISSION AND CONFORM TO APPLICABLE LAWS, REGULATIONS, AND BUSINESS PRACTICES. AS A FAITH-BASED ORGANIZATION SPONSORED BY THE SEVENTH-DAY ADVENTIST CHURCH (THE CHURCH), AHSSHC'S PHILOSOPHY AND PRINCIPLES WITH RESPECT TO ITS EXECUTIVE COMPENSATION PRACTICES REFLECT THE CONSERVATIVE APPROACH OF THE CHURCH'S MISSION OF SERVICE AND WERE DEVELOPED IN COUNSEL WITH THE CHURCH'S LEADERSHIP.

PART I, LINES 4A-B

PART I, LINE 4A: DURING THE YEAR ENDING DECEMBER 31, 2023, RICHARD CARROLL AND JARED BROWN RECEIVED SEVERANCE PAYMENTS IN THE AMOUNT OF $221,658 AND $72,693 RESPECTIVELY. PURSUANT TO THE AHSSHC CORPORATE EXECUTIVE POLICY GOVERNING EXECUTIVE SEVERANCE, SEVERANCE AGREEMENTS FOR EXECUTIVES OPERATING AT THE VICE PRESIDENT LEVEL AND ABOVE ARE ENTERED INTO UPON ELIGIBILITY TO FACILITATE THE TRANSITION TO SUBSEQUENT EMPLOYMENT FOLLOWING AN INVOLUNTARY SEPARATION FROM EMPLOYMENT WITH ADVENTHEALTH. PART I, LINE 4B: PURSUANT TO THE AFFILIATION AGREEMENT BETWEEN AHSSHC AND UCMC, THE INDIVIDUALS LISTED IN PART VII INCLUDE INDIVIDUALS WHO ARE COMPENSATED BY AHSSHC AS MANAGER. ACCORDINGLY, THE SUPPLEMENTAL NON-QUALIFIED RETIREMENT PLANS SPONSORED BY AHSSHC ARE DISCUSSED BELOW. THE OFFICERS AND KEY EMPLOYEES LISTED IN PART VII ARE PROVIDED TO THE FILING ORGANIZATION BY ADVENTIST HEALTH SYSTEM SUNBELT HEALTHCARE CORPORATION (AHSSHC) PURSUANT TO THE MASTER MANAGEMENT AGREEMENT. THE EXECUTIVE MANAGEMENT TEAM PROVIDED TO THE FILING ORGANIZATION PARTICIPATES IN THE SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS SPONSORED BY AHSSHC. THE SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS ARE DESCRIBED BELOW AND INCLUDES ALL PLANS IN WHICH THERE WERE ANY PARTICIPANTS IN 2023. SERP III PLAN: THE SERP III PLAN PROVIDES ELIGIBLE EXECUTIVES A PERCENTAGE OF THEIR BASE PAY, WHICH IS CREDITED TO A DEFERRED COMPENSATION ACCOUNT. THE PLAN ALSO PROVIDES FOR COMPENSATION DEFERRAL AND SELECTION OF LIFE INSURANCE COVERAGE AND LONG-TERM CARE INSURANCE. TO BE ELIGIBLE TO PARTICIPATE IN THE SERP III PLAN, EXECUTIVES MUST BE ON THE AHSSHC CORPORATE PAYROLL AND BE EITHER A CEO OF AN ADVENTHEALTH ENTITY, AN AHSSHC VICE PRESIDENT (VP) OR VP OF AN ADVENTHEALTH ENTITY WITH A BASE SALARY OF AT LEAST $330,000 IN 2023 (ADJUSTED ANNUALLY BY THE SAME PERCENTAGE AS IRC SECTION 401(A)(17) LIMIT INCREASES), OR OTHER LEADER SPECIFICALLY APPROVED BY THE ADVENTHEALTH PRESIDENT. ELIGIBLE EXECUTIVES DO NOT INCLUDE GRANDFATHERED EXECUTIVES, MEANING THOSE EXECUTIVES WHO WOULD SATISFY ALL THE ELIGIBILITY REQUIREMENTS OF THE SERP II PLAN PRIOR TO DEC 31, 2027, HAD THE PLAN NOT BEEN AMENDED AND RESTATED AS OF JAN. 1, 2020. CONTRIBUTION CREDITS WILL BE ESTABLISHED AND MAINTAINED BY CLASS YEAR ACCOUNTS FOR EACH PARTICIPANT USING TIERED CONTRIBUTION CREDIT PERCENTAGES OF ANNUAL BASE COMPENSATION. CONTRIBUTION CREDIT PERCENTAGES RANGE BETWEEN 15% AND 19% OF BASE COMPENSATION. CONTRIBUTION CREDITS WILL BE MADE EACH QUARTER IN 25% INCREMENTS WITH REDUCTIONS IN CONTRIBUTIONS IF THE EXECUTIVE IS ALSO A GRANDFATHERED FLEX PARTICIPANT (SEE BELOW). SERP III PROVIDES FOR A CLASS YEAR VESTING AND PAYMENT SCHEDULE (7 YEARS FOR EACH CLASS YEAR) WITH RESPECT TO AMOUNTS ACCUMULATED IN THE EXECUTIVE'S DEFERRED COMPENSATION ACCOUNT. UPON ATTAINMENT OF A NORMAL RETIREMENT AGE (AGE 62), OR UPON CERTAIN OTHER CIRCUMSTANCES AS DEFINED IN THE SERP III PLAN DOCUMENT, ALL DEFERRED AMOUNTS ARE PAID IMMEDIATELY TO THE PARTICIPANT. FOR ANY EXECUTIVES WORKING BEYOND THE NORMAL RETIREMENT AGE, FUTURE EMPLOYER CONTRIBUTIONS WILL BE MADE QUARTERLY FROM SERP III DIRECTLY TO THE PARTICIPANT AS A TAXABLE CASH BONUS. SERP II PLAN: THE SERP II PLAN IS A DEFINED BENEFIT, NON-TAX-QUALIFIED DEFERRED COMPENSATION PLAN FOR CERTAIN EXECUTIVES WHO HAVE PROVIDED LENGTHY SERVICE TO ADVENTHEALTH AND/OR TO OTHER SEVENTH-DAY ADVENTIST CHURCH HOSPITALS OR HEALTH CARE INSTITUTIONS. UNDER THE PROVISIONS OF THE SERP II PLAN, BENEFITS ARE PROVIDED TO QUALIFYING EXECUTIVE PARTICIPANTS ON A PRO-RATA SCHEDULE BEGINNING WITH 20 YEARS OF SERVICE AS AN EMPLOYEE OF ADVENTHEALTH AND/OR ANOTHER HOSPITAL OR HEALTH CARE INSTITUTION CONTROLLED BY THE SEVENTH-DAY ADVENTIST CHURCH AND WHO SATISFY CERTAIN OTHER QUALIFYING CRITERIA. ELIGIBLE EMPLOYEES ARE RESTRICTED TO THOSE EXECUTIVES WHO, AS OF JANUARY 1, 2020, SATISFIED, OR IF EMPLOYMENT CONTINUES, WILL SATISFY THE ELIGIBILITY REQUIREMENTS OF SERP II PRIOR TO DECEMBER 31, 2027. THIS SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (SERP II) WAS DESIGNED TO PROVIDE ELIGIBLE EXECUTIVES WITH THE ECONOMIC EQUIVALENT OF AN ANNUAL INCOME BEGINNING AT NORMAL RETIREMENT AGE EQUAL TO 60% OF THE AVERAGE OF THE PARTICIPANT'S THREE, FIVE OR SEVEN HIGHEST YEARS OF BASE SALARY FROM ADVENTHEALTH ACTIVE EMPLOYMENT INCLUSIVE OF INCOME FROM ALL OTHER SEVENTH-DAY ADVENTIST CHURCH HEALTHCARE EMPLOYER-FINANCED RETIREMENT INCOME SOURCES AND INVESTMENT INCOME EARNED ON THOSE CONTRIBUTIONS THROUGH SOCIAL SECURITY NORMAL RETIREMENT AGE AS DEFINED IN THE PLAN. THE NUMBER OF YEARS INCLUDED IN HIGHEST AVERAGE COMPENSATION IS DETERMINED BY THE INDIVIDUAL'S YEAR OF ENTRY TO SERP II AND BY THE INDIVIDUAL'S YEAR OF ENTRY TO THE ADVENTHEALTH EXECUTIVE FLEX BENEFIT PROGRAM. FLEX PLAN: THE FLEX PLAN WAS ORIGINALLY DESIGNED TO PROVIDE ELIGIBLE EXECUTIVES AN OPPORTUNITY TO SELECT FROM AMONG A VARIETY OF SUPPLEMENTAL BENEFITS, INCLUDING A SPLIT DOLLAR LIFE INSURANCE POLICY AND LONG-TERM CARE INSURANCE, TO INDIVIDUALLY TAILOR A BENEFITS PROGRAM APPROPRIATE TO EACH EXECUTIVE'S NEEDS. IN 2020, THE FLEX PLAN WAS AMENDED TO EXCLUDE EMPLOYED EXECUTIVES WHO ARE HIRED OR PROMOTED AFTER A CERTAIN DATE FROM BEING ELIGIBLE TO PARTICIPATE IN THE FLEX PLAN EXCEPT FOR CERTAIN INSURANCE COVERAGE FEATURES OF THE PLAN. THE FLEX PLAN PROVIDES ELIGIBLE PARTICIPANTS A PRE-DETERMINED BENEFITS ALLOWANCE CREDIT THAT IS EQUAL TO A PERCENTAGE OF THE EXECUTIVE'S BASE PAY FROM WHICH THE COST OF MANDATORY AND ELECTIVE EMPLOYEE BENEFITS IS DEDUCTED. THE BENEFITS ALLOWANCE CREDIT PERCENTAGE FOR ANY PLAN YEAR SHALL NOT BE GREATER THAN THE MAXIMUM DOLLAR AMOUNT OR THE PERCENTAGE OF COMPENSATION AS DETERMINED BY THE ADVENTHEALTH BENEFITS ADMINISTRATION COMMITTEE. FOR GRANDFATHERED ELIGIBLE EMPLOYEES, THE ANNUAL PRE-DETERMINED FLEX ALLOWANCE IS CONTRIBUTED AND ANY FUNDS THAT REMAIN AFTER THE COST OF MANDATORY AND ELECTIVE BENEFITS ARE SUBTRACTED ARE, AT THE EMPLOYEE'S OPTION, CONTRIBUTED TO EITHER AN IRC 457(F) DEFERRED COMPENSATION ACCOUNT OR TO AN IRC 457(B) ELIGIBLE DEFERRED COMPENSATION PLAN. UPON ATTAINMENT OF AGE 65, ALL PREVIOUS 457(F) DEFERRED AMOUNTS ARE PAID IMMEDIATELY TO THE PARTICIPANT AND ANY FUTURE EMPLOYER CONTRIBUTIONS ARE MADE QUARTERLY FROM THE PLAN DIRECTLY TO THE PARTICIPANT. THE PLAN PROVIDES FOR A CLASS YEAR VESTING SCHEDULE (2 YEARS FOR EACH CLASS YEAR) WITH RESPECT TO AMOUNTS ACCUMULATED IN THE EXECUTIVE'S 457(F) DEFERRED COMPENSATION ACCOUNT. DISTRIBUTIONS COULD ALSO BE MADE FROM THE EXECUTIVE'S 457(F) DEFERRED COMPENSATION ACCOUNT UPON ATTAINMENT OF AGE 65 OR UPON AN INVOLUNTARY SEPARATION. THE ACCOUNT WILL BE FORFEITED BY THE EXECUTIVE UPON A VOLUNTARY SEPARATION. WITH RESPECT TO GRANDFATHERED PARTICIPANTS, THE FLEX PLAN DOCUMENTS DEFINE ELIGIBLE EMPLOYEES TO INCLUDE THE CHIEF EXECUTIVE OFFICERS OF ADVENTHEALTH ENTITIES AND VICE PRESIDENTS OF ALL ADVENTHEALTH ENTITIES WHOSE BASE SALARY WAS AT LEAST EQUAL TO THE INTERNAL REVENUE CODE SECTION 401(A)(17) COMPENSATION LIMIT EACH YEAR.

PART I, LINE 4B (CONTINUED):

FLEX PLAN FLEX PLAN SERP III SERP III CONTR. DISTR.* CONTR. DISTR.* THORDARSON,THOR $ 0 $ 0 $ 147,790 $ 0 BUCHANAN, HERBERT $ 0 $ 0 $ 73,311 $ 73,311 RADIVOJEVIC, VLADIMIR $ 0 $ 0 $ 51,651 $ 0 KRIKORIAN, ARMAND $ 0 $ 0 $ 55,385 $ 0 MATHIS, REBECCA $ 0 $ 0 $ 79,033 $ 0 * INCLUDING INVESTMENT EARNINGS

FORM 990, PART VII, SECTION A, LINE 5:

THE CEO, CFO, COO, CMO, AND CNO WERE COMPENSATED BY AHSSHC, AN UNRELATED ORGANIZATION, DURING THE FISCAL YEAR ENDED JUNE 30, 2024, FOR SERVICES PROVIDED TO THE FILING ORGANIZATION. PLEASE SEE OUR RESPONSE TO FORM 990, SCHEDULE J, PART I, LINE 1A FOR A DISCUSSION CONCERNING THE PROVISION OF EXECUTIVE MANAGEMENT PERSONNEL BY AHSSHC AS MANAGER TO THE FILING ORGANIZATION. COMPENSATION FOR THESE EXECUTIVES IS DISCLOSED IN PART VII AND SCHEDULE J, PART II.