BAPTIST HEALTH SYSTEM INC

HOSPITAL JOINT VENTURE - BAPTIST HEALTH SYSTEM, INC. (BHS) CONTINUES IN ITS CHARITABLE MISSION, WHICH BEGAN IN 1922, OF PROVIDING MEDICAL AND EDUCATIONAL SERVICES TO THE COMMUNITY THROUGH ITS 30% JOINT VENTURE INTEREST IN BROOKWOOD BAPTIST HEALTH, LLC (BBH). THE JOINT VENTURE WAS FORMED WITH TENET WHICH OWNS THE REMAINING 70% INTEREST. TENET MANAGES THE JOINT VENTURE AND THE TERMS OF THE MANAGEMENT AGREEMENT REQUIRE THAT THE JOINT VENTURE BE MANAGED PURSUANT TO THE REQUIREMENTS OF CODE SECTION 501 (C) (3) AND THE CHARITABLE PRINCIPLES, WHICH ARE SET FORTH IN THE LLC AGREEMENT. IN THE EVENT MANAGEMENT FAILS TO COMPLY WITH THESE REQUIREMENTS, THE MANAGEMENT AGREEMENT AND LLC AGREEMENT PROVIDE CERTAIN TERMINATION RIGHTS. IN ADDITION, THE PARTIES HAVE AN EQUAL NUMBER OF DIRECTORS APPOINTED FOR THE JOINT VENTURE. BHS RETAINS CERTAIN ADDITIONAL POWERS (DESCRIBED ABOVE FROM THE MANAGEMENT AGREEMENT AND LLC AGREEMENT) TO ENSURE THE JOINT VENTURE WILL CONTINUE TO FURTHER BHS'S CHARITABLE PURPOSES. THE MANAGEMENT BOARD OF THE LLC INCLUDES A BLOCK VOTING MECHANISM FOR EACH MEMBER'S APPOINTED DIRECTORS.BBH OPERATES FIVE HOSPITALS AND OTHER PATIENT CARE FACILITIES. TWO OF THE HOSPITALS ARE LOCATED WITHIN THE CITY LIMITS OF BIRMINGHAM, AL, WHICH ENABLES BBH TO PROVIDE SERVICES TO AREAS OF THE CITY WHICH MIGHT OTHERWISE BE UNDERSERVED. THE OTHER THREE HOSPITALS ARE LOCATED IN TALLADEGA, JASPER, AND ALABASTER, AL. SEVERAL OF THESE HOSPITALS SERVE RURAL COMMUNITIES WHICH, PRIOR TO BHS'S (AND SUBSEQUENTLY BBH'S) INVOLVEMENT, WERE IN NEED OF STABLE HEALTH CARE FACILITIES. THESE RURAL HOSPITALS PROVIDE MUCH NEEDED SERVICES (SUCH AS OBSTETRICS), TO AREAS OF ALABAMA THAT WOULD OTHERWISE BE UNDERSERVED. BBH EXPERIENCES LOSSES FROM SOME OF THESE HOSPITALS, WHICH FURTHER DEMONSTRATES ITS COMMITMENT TO SERVING THESE COMMUNITIES.EACH HOSPITAL PARTICIPATES IN THE MEDICAID PROGRAMS AND EXPERIENCE LARGE CONTRACTUAL ADJUSTMENTS DUE TO THE LIMITED REIMBURSEMENT PROVIDED BY SUCH PROGRAM. ADDITIONALLY, EACH HOSPITAL PARTICIPATES IN VARIOUS OTHER FEDERAL, STATE AND LOCAL MEDICAL PROGRAMS. THIS PARTICIPATION IMPROVES ACCESS TO PATIENT CARE FOR THE COMMUNITIES SERVED BY BBH.BBH IS ACTIVELY INVOLVED IN MEDICAL EDUCATION AND CLINICAL PASTORAL CARE EDUCATION. BBH CURRENTLY HAS APPROXIMATELY 99 RESIDENCY POSITIONS IN TRANSITIONAL YEAR, INTERNAL MEDICINE, PATHOLOGY, RADIOLOGY AND GENERAL SURGERY PROGRAMS. BBH'S MEDICAL EDUCATION PROGRAM ALSO PROVIDES CONTINUING EDUCATION TO LICENSED PHYSICIANS. THE CLINICAL PASTORAL CARE EDUCATION PROGRAM PROVIDED TRAINING FOR 7 RESIDENTS AS WELL AS NUMEROUS PART-TIME STUDENTS. THIS TRAINING EQUIPS STUDENTS TO PROVIDE A BETTER LEVEL OF SPIRITUAL CARE TO PATIENTS. IN ADDITION, BBH, IN CONJUNCTION WITH SEVERAL COLLEGES AND UNIVERSITIES OF NURSING, PROVIDES TRAINING FOR NURSES THAT ARE HIRED THROUGHOUT THE SOUTHEASTERN UNITED STATES.FINALLY, BBH CONTINUALLY PROVIDES MANY SERVICES IN HEALTH PROMOTION AND SCREENING TO THE PUBLIC FREE OF CHARGE OR AT A NOMINAL COST. SUCH SERVICES ARE PROVIDED THROUGH SCHOOLS, EMPLOYERS, AND FACILITIES THAT ARE EASILY ACCESSIBLE BY THE GENERAL PUBLIC. EMPLOYEES ARE ENCOURAGED TO DEVOTE SERVICES TO OTHER CHARITABLE ORGANIZATIONS IN THE COMMUNITY, AS WELL AS TO PROVIDE FINANCIAL SUPPORT. EMPLOYEES AND OTHER COMMUNITY MEMBERS HAVE ALSO PROVIDED SIGNIFICANT SUPPORT OF BBH'S CHARITABLE ACTIVITIES EVIDENCING THE COMMUNITIES' WILLINGNESS TO ACKNOWLEDGE AND SUPPORT THE MISSION OF BROOKWOOD BAPTIST HEALTH.

BHS MANAGES THE OPERATIONS OF THE BAPTIST HEALTH FOUNDATION, INC. (BHF). BHF EXISTS TO SUPPORT BHS BY ENGAGING IN FUNDRAISING ACTIVITIES AND PROVIDING FUNDS TO SUPPORT CONTINUED IMPROVEMENT OF HEALTH, PROVIDE PATIENT ASSISTANCE, AND PROMOTE EDUCATION FOR COMMUNITIES SERVED BY BROOKWOOD BAPTIST HEALTH (BBH) IN A WAY THAT FURTHERS THE HEALING MINISTRY OF CHRIST. OVER THE COURSE OF THE YEAR, BHF PROVIDED OVER $2.5 MILLION DOLLARS IN FINANCIAL SUPPORT OF PROGRAMS IMPACTING BBH PATIENTS, EMPLOYEES AND COMMUNITIES INCLUDING PROVIDING FOR INDIGENT CARE, PASTORAL CARE, EMPLOYEE ASSISTANCE, EDUCATION, SCHOLARSHIPS, GRANTS AND OTHER ASSISTANCE.