form 990 return of organization exempt from income...

Return of Organization Exempt From Income Tax Under section 501(c), 527, or 4947(a)(1) of the Internal Revenue Coda (except It lack loop

benefit trust or private foundation) " The organization may have to use a copy of this return to satisfy state reporting requirements

Department of the Trequry Intemei Revenue £e616

A For the 2002 eaten D Employer Identification number B cne:w .l

wohuzt~ie

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~Narro cnenq

QInIVeI mNm

~ Final mWm Ammoeo

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in~~ a41-%`-,o

54-0620889 Room/suite E Telephone number

703-289-2433

,,o;INOVA HE ALTH CARE SERVICES t°° Number and sliest (or P 0 box d mail is not delivered to street address) a~n<2990 TELESTAR COURT, FOURTH FLOOR TAX 17M.- d,, City or town, state or country, and ZIP +4 F Mcawero"ma¢ LJ Cash LXJ ~ruai

O I, =iN11 41sesuon 5ot(c)(3) nrpanizatlons ono asa7(a)(t) nonexempt must attach a some feted Schedule A (Form 990 or 990-EZ)

M Check " LI d the organization is not required to attach Sch B(FOrm 990,990-EZ,or990-PF) 19

1 Contributions, gifts grants, and similar amounts received a Direct public support 1a 6 Indirect public support 16 3 , 847 , 430 . a Government contributions (prants) to 4 , 614 , 164 . d Total (aadlines iathrough ic) (cash 5 8,461,594 . noncashg ~ td 8 , 4 61,594 .

2 Program service revenue including government fees and contracts (from Pan VII, line 93) 2 852 , 1 17,083 . 3 Membership dues andasssssments 3 4 Interest on savings and temporary cash investments 4 2 , 050,194 . 5 Dividends and interest from securities 5 sa Gross rents See Statement 2 Be 10 526 032 .

b less rental expenses See Statement 3 6b 8 , 045 , 807 . c Nat rental income or (lass i (subtract line 6D from line 6a) 6e 2 , 480, 2 25 .

7 Olherinvestment income idescrine " See Statement 1 7 103, 349 . Ba Gross amount from sale olassets other A Securities B Other

m than inventory 19,195 . 8a Q b Less cost or other basis and sales expenses 22 1 450 . Bb

r, Gain or (loss) (attach schf owe) <3 , 255 . 8c d Not gain or (loss) (combine line 8c, columns (A) and (B)) Stmt 4 Of <3,255 .>

9 Special events and actrviti3s (attach schedule) a Grass revenue (not including S of contributions

reported on line 1a) 9a b Less direct expenses other than fundraising expenses 9b e Net income or (lass) from special events (subtract line 96 from line 9a) 9e

0 10 a Gross sales of inventory, tees returns and allowances 10a D Less Cast of goods sold 10b O

cli c Gross profit or (lass) from sales of inventory (attach schedule) (subtract line 10h from line 10a) 10c 11 Other revenue Iirom Part VII, line 103) 11 19 177 9 7 2 . 72 Total revenue (ado lines 7U 2 3 a 5 6c 7 8d 9c 10c and 71 12 884 387, 162 . Z 13 Program services (tram line 44, column (B)) ~

RFCFIVEO is 721 096 , 767 .

~ 14 Management and general (from line 44, column (C)) 14 125 016 , 4 17 . W 8 15 Fundraising (tromline 44,column (D)) ~ NOV 1 2 id

w 15

16 Payments to affiliates (attach schedule)

-

~ 16 17 Total ex penses ( add line>16and44 column A 17 846 113 184 . 18 Excess or (deficit) for the year (subtract line 17 from line 12) 18 3 3 9 7 8 .

~ 19 Net assets or fund balances at beginning of year (from line 73, column (A)) 19 5 31 1, N 0 , 277 . zI 20 Other changes innetassetsarfund balances (attachexDlanahon) S22 Statement 5 20 <1Z5,760,704 .>

o1-2: m LHA For Paperwork Reduction Act Notice, see the separate Instructions 1

11001027 746301 hosp 2002 .06000 INOVA HEALTH CARE SERVICES

Form 990 (2002)

HOSP 1 !J

Form 990

P,asn,it I C Name of organization

J Org anization type (uiawmNuvt)"Lj 501(c)(3 ) A Orsenno) Uqgq7(y)(1)Or U52 R Chuck here " L-j if the organization's gross receipts are normally not more than $25,000 The

organization need no[ file a return wit i the IRS, but it the organization received a Farm 990 Package in t he mail, rt should file a return with o ut financial data Some states require a complete return

H and I ere not applicable to section 527 orc,janizations H(a) Is this a group return tar affiliates? El Yes ~ No H(b) If Yes; enter number of affiliates Boo H(C) Are all affiliates included N/A [~ Yes D No

(if No, amach a list ) Hit) Is this a separate return tiled by an or- , .._~

and (D) are required for section 501(c)(3) able trusts but optional for others

(C) Management (D) Fundraising and anent

i, p, ' 0~ . . 58,026 969 .

i . 2,472 574 . . . 4 , 936 , 497 . 1 I . 4,069,690 .

ust complete column (A) Columns is and section 4947(a)(1) nonazen

(A)Total (B) Progi snrvic

22 Gents and allocations (attach schedi le) cash $--nonmh$-- 22

23 Specific assistance to individuals (anich schedule) 23 24 Benefits pain to or tar members (atta :h schedule) 24 25 Compensation of officers . directors, o1c 25 26 Other salaries and wages 26 27 Pension plan contributions 27 28 Other employee benefits 28 29 Payroll taxes 29 30 Professional fund raising fees 30 31 Accounting tees 31

32 Lepalfees 32

33 Supplies -L3 34 Telephone 34 35 Postage and shipping 35 36 Occupancy 36

37 Equipment rental and maintenance 37

38 Pooling and publications 38 39 Travel 39 40 Conternncas, conventions, and meetings 40 41 Interest 41 42 Depreciation, 0epletion,etc (attach,chedula) 42

43 Other expenses not covered above (itemize) a 43 : p Cat

Q d 43c e See Statement E a3i 448,3

What isth6orpanization'sprimary exert ptpurpose' t see statement -/ Pro ram Service

Pllorp~nl:edonamuatdmrnDeViNrmemPt OLirWsex~IwenenblnsclmrenEmndsemanner SIateNenumOarolclimbeerved puoilntlonsiaeuea etc Difcuaa ~xpB1150S

achlevsmnteNelerenolrtmaurebie(SecUOr501(c/(J) e^4141oqenlzetlona,nOC847(~(1)nonuamOtchanGCieWSbmuatNfomivNee~muntolplanKenE (BeQulre0 for 501(e)(J) e (C) orp and 4947(&X

dlxJtlone M oViere) tittsts but option al for on

a See Attached Statement

Form 990 (2002)

HOSP 1 2

2002 .06000 INOVA HEALTH CARE SERVICES 11001027 746301 hosp

PaR 1(

5 126 757 .172 687 125 . 2 , 439 , 15 2 , 721,850 . 1 , 404,934 . 1 , 3-16 , 9 1 989 407 . 1,12-2- f ,93-7 . - 866 4 4 098 067 . S 323 033 . 5,775 , 10 7 , 402 , 044 . 6 , 044 , 198 . 1,357 8 1 , 375 , 940 . 854 757 . 521 , 1 1 , 292 , 633 . 709 823 . 582 8

N01 246 . 828 466 . 1,072 , 7

9 .254,753 . 22,522 .606 . <3,267,8

40 6~y~tort~kLq~cWrtis(UH~I~WY~x12a5m1I1net1S75 ~441846,113,184 .1721,096,767 .1125,016,417 .1 Joint Costs Check " E-J it you are following SOP 98-2 Are any point casts from a combined e0icational campaign and fundraising solicitation reported in (B) Program services 1 ~ Yes I X No

If Yes,' enter fQ the aggregate amount of these point costs $ , (II) the amount allocated to Program services S

b

c

d

096 .767 .

Form 990(2002) INOVA HEALTH CARE SERVICES 54-0620889

Pmt IV Balance Sheets

Node Where required, attached schedules and amounts within the description column (A) (9) hould tie (or end-of-year amounts only I Beginning of year ~ End of year

187 .585 .185 .147o1 182,403,226

48 a Pledges receivable

b Less allowance for doubtful accounts 48b

49 Grants receivable

50 RecervaDles from officers, crtectors, trustees,

and key employees N 0 51 a Other notes and loans receivable 51 a

'~ b Lass allowance tord0UbtfLI accounts 51b

52 Inventories for sale or use

53 Prepaid expenses and date red charges

54 Investments -securities StIRt 8 1 ~X Cast 0 FMV

SS a Investments -land,6wldinqs,and

equipment basis I 55a L

89

b Less accumulated de0reciution 56 Investments-other 57 a Land, buildings, and equipment basis

6 Less accumulated depreciation 58 Other assets (describe lll~

See Statemen

434,025,7 See sta

1399873990 .

sz=i 01 22 ro

3 11001027 746301 hosp 2002 .06000 INOVA HEALTH CARE SERVICES HOSP1

45 Cash - non-interest-bearing 46 Savings and temporary cash investments

-17a Accounts receivable 47a 377 035 902 .

D Less allowance for doubtful accounts ~ 47U ~ 194 , 632 , 676 .

92

7

58 . 21 .

60 Accounts payable and accrued expenses i v u v c i Ju u . ou c ~ 0v v Y , a ~ ~ .

61 Grams payable 61

62 Deferred revenue 62

63 Loans from officers, directors, trustees, and key employees 63

a Ba a rax-ezemptbond uabaitie: 628 616 766 . 6aa 481 , 265 , 579 . j 6 Mortgages and other note, payable 64b

65 Other liabilities (descnbe t See Statement 11 ~ 130 728 238 . 65 208 580 749 .

66 Total liabilities add lines somrou nss 859 972 510 . ss 94-3 , 510 , 439 . Organizations that follow SFAS 117, cheek here 10, W and complete lines 67 through

09 and lines 73 and 74 67 Unrestricted 533 828 553 . 67 456 341,827 .

A BB Temporarily restricted 21 , 724 . 68 21 , 724 .

69 Permanantry restricted fig °c0 Organizations that do not follow SFAS 117, shack here 1 D and complete lines

u 70 through 74 70 Capital stock, trust principal, or current funds

y

70

71 Paid-in or capital surplus, or land building, and equipment fund 71

a 72 Retained earnings, endaxment, accumulated income or other funds 72

= 73 Total net assets or fund balances (add lines 67 through 69 or lines 70 through 72

column (A) must equal line 19 column (B) must equal iine2t) 533 850 277 . 73 456 363 551 . 74 Total liabilities anUnet .assets/fund balances (aadlines 66and73) 1393822787 . 74 1399873990 .

Form 990 is available for public inspection and, for some people, serves as the primary or sale source of information about a particular organization How the public perceives an organization in such Case,, may be determined by the information presented on its return Therefore, please make sure the return is complete and accurate and fully clescnhes, in Part III, the orpauzalion's programs and accomplishments

scion Or revenue per Auaitea Staternents with Revenue per

jnses per Audited with Expenses per

a Total revenue, pains, and other support peraudited financial statements " a 124862

h Amounts included on line a but nod on line 12 Form 990

(1) Net unrealized pains on investments =

(2) Donated services and use of facilities $

(3) Recoveries of pnor year grants

(4) Other (specify) Stmt 12 $ 364237838 .

nedamounts onlines (1) through [11) " b 36423 c Lineaminus line h " s 86438 d Amounts included on line 72, Form

990 Gut not on line a

(1) Investment expenses not included on line 6b, Form 990 S

(2) Other (specify)

a Total expenses and losses per audited financial statements

b Amounts included an line a but not an line 17, Farm 990

(11 Donated services and use of facilities $

(2) Prior year adjustments reported on line 20, Form 990 S

(3) Lasses reported on line 20, Form 990 $

(4) Other (specily) Stmt 13 s 417439816 .

Add amounts on lines (1) through (4) c Line a minus line h d Amounts included on line 17, Form

990 but not an line a

(11 investment expenses not included on

line 6b, Form 990 $ (2) Other (specify)

one even it not compensated

(A) Name and address

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

See Statement 14 --------------------------------- ---------------------------------

--------------------------------- ---------------------------------

-- ------------------------------ ---------------------------------

--------------------------------- -----------------------------------

--------------------------------- ---------------------------------

--------------------------------- ----------------------------------

---------------------------------- ---------------------------------

------------------------------ ---------------------------------

peg week devoted to I (If rat

0 . 0

4 11001027 746301 hosp 2002 .06000 INOVA HEALTH CARE SERVICES HOSP 1

CARE SERVICES

ado amounts on lines (1) and (2) " d 0 . Add amounts on lines (1) and (2) e Total revenue per line 12, Form 99C a Total expenses per line 17, Form 990

(linecplus line d) " e 884387162 . (linecolusline dl

0

3184

75 Did any officer, director, trustee, or key employee receive aggregate compensation o1 more than 5100,00D from your organization and all related organizations, of which more lean 1 ,1 0,000 was provided by the related organization s It 'Yes,' attach schedule 1 OYes MNo Form 990 (2002)

723031 01 22 09

0889 Yes No

7s x 77 X

yea X 780 g X

80a X

CARE Form 990

76 Did the organization engage in any activity not previously reported to the IRS If 'Yes,' attach a detailed description of each activity 77 Were any changes made in the orp,inizing or governing documents but not reported to the IRS

It Yes; attach a conformed copy of the changes 78 a Did the organization have unrelated business gross income of $1,000 or more during the year covered 6y this return

O If 'Yes' has it filed a tax return on Form 990-T tar this years NBA 79 Was there a liquidation, dissolution, termination, or substantial contraction during the years

If 'Yes .' attach a statement 80 a Is the organization related (other than 6y association with a statewide or nationwide organization) through common membership,

governing bodies, trustees, officer ;, etC , to any other exempt or nonexempt organization? b If'Ye : ; enter lhename otlhaOrganization " See statement 15 .and check whether it is E] exempt or 0 nonexempt

81 a Cnter direct or indirect political expenditures See line 81 instructions 81a 0 h Did the organization file Form 1126-POL for this years

82 a did the organization receive Oonattd services or the use of materials, equipment, or facilities al no charge or al substantially less than fair rental value

b It 'Yes,' you may indicate the value of these items here Do not include this amount as revenue in Part I or as an expanse in Part II (See instructions in Part III ) I 82h ~ N/A

83 a Did the organization comply with the public inspection requirements for returns and exemption apDlications9 h Did the organization comply xrth Via disclosure requirements relating to quid pro quo contrlbutloW

84 a Did the organization solicit any conin6u6ons or gifts that were riot fax deductibles D If 'Yes,' did the organization incluta with every solicitation an express statement that such contributions or gifts were not

tax daductiblO N/A 85 501(c)(4), (5), or (6) organizations a Were substantially all dues nondeductible by memDers9 NBA

b Did the organization make only in-house lobbying expenditures 0132,000 or less N/A II Yes' vas answered to ether 853 or 85b, do not complete BSc through B5h below unless the organization received a waiver for proxy tax owed for the prior year

c Dues, assessments anGsimilar amounts from members BSc N/A E Section 162(e) lobbying and political expenditures 85d N/A e Aggregate nondeductible amount of section 6033(e)(1)(A) dues notices 850 N/A 1 Taxable amount of lobbying and Folilical expenditures (line 85a less 85e) 851 ~ NBA p Does the organisation elect to pay the section 6033(e) tax on the amount on line 85» N/A h II section 6033(a)(1)(A) dues notices were sent, does the organization agree to ado the amount on line BSt to its reasonable estimate o1 dues

allocable to nondeductible lobbying and political expenditures poi the following tax years NBA 86 501(c)(7) organizations Enter a initiation fees and capital contributions included on line 12 86a N/ A

h Gross receipts, included on line 12 for public use of club facilities 86h NBA 87 507(c)(12) organizations Enter a Gross income from members or shareholders 87a N/A

b Gross income tram other source' . (DO riot net amounts due or paid to other sources against amounts due or received from them ) B7h N /A

88 Al any time during the year, did the organization own a 50% or greater interest in a taxable corporation or partnership, or an entity disregarded as separ3le from the organization under Regulations sections 3017701-2 and 3017701-37 It 'Yes,' complete Part IX

89 a 501(c)(3) organizations Enter Amount of tax imposed on the organization during the year under section 4911 10, 0 . , section 4912 . 0 ._ , section 4955 . 0 .-

to 507(c)(3) end 501(c)(4) organ zehons Did the Organization engage in any section 4958 excess benefit transaction during the year or dial it become aware of an excess benefit transaction from a prior year It 'Ias ; attach a statement expla inlng each transaction

t Entsr Amount of tax imposed ors the orpanizaUon managers or disqualified persons during the year under sections 4912 4955, and 4958

d Enter Amount of tax on line 89c above, reimbursed by the organization 90a List lheStates with which acopy otthis return isfiled " CALIFORNIA, NORTH CAROLINA

0 Number of employees employed in one pay period trial includes March 12, 2002 90h 97 Thoboaksareincare of " I ROVd Health Care Services Telephone no " 703-2f

X

Locaceaatt 2990 Telestar Ct ., VA zia+4 " 22042

0 92 Section 4947(a)(1) nonexempt charitable mists filing Form 990 in lieu of Form 1041- Check here

5 11001027 746301 hasp 2002 .06000 INOVA HEALTH CARE SERVICES HOSP1

X

X

11

Form 990(2002)

Paid Preparer s ' ~~ �, ,-signature ~ ~o

Preparer's F�� ~�� ,(o, KAISER SCHERER & CHLE Use Only ~~o1oYW1 '1899 L STREET, N .W ., S

seamss ana nZ~~fi lm LP .a WASHINGTON, D .C . 20036

2002 . 11001027 746301 hosp

Form 990(2002y INOVA HEALTH CARE SERVICES 54-0620889

Part YII Analysis of Income-Producing Activities (See gape 31 of the instructions )

Note Enter gross amounts unless otherwise Unrelated business income excwaao e secuon siz spa o. sia

indicated (A) (B) ~,~~- (0) Related or exempt Business oAmount ,e Amount 93 Program service revenue function income

a Patient Service Revenue 850 0(12,246 .

o Premier Purch partner- 541900 <22,820 . 2 , 1 37,657 .

c s~ income related to a program service: e I Medicare/Medicaid payments g Fees and contracts tram government agencies

94 Memhurship dues and assessments 95 Interest on savings and temporary cash investments 14 2 , 050, 194 .

96 Dividends and interest from securihas 97 Not renal income or (loss) from real estate a debt-financed property b not debt-financed property __L6 2 , 480 , 25 .

AB Net rental income or (loss) from pa sonal property 89 Other Investment income 14 67 , 650 . 35,699 .

100 Gain or (loss) from sales of assets otherthanmventary 18 <3 255 .

101 flat income or (lass) from special events 102 Gross profit or (loss) from sales of inventory 103 Other revenue

a Revenue Incidental 03 19 177,972 .

b PHARMACEUTICAL CONTRACT 541700

c LAUNDRY SERVICES 812300

e OTHER HEALTH SERVICES 621990

e PENSION ADJUSTMENT 03i I tOn Subtotal (addcolumns (s),(o),anu(Q) <22,820 . 23,772,786 . 852,175,602 .

105 Total (addline 104columns (B),1D),and(E)) " 875,925,568 .

Note Lino 105 plus line to, Pat I, should equal the amount on line 12, Part Pa't Vill Relationship of Activities to the Accomplishment of Exempt Purposes (Seepage 32 0f the instructions

Line No Explain how each activity for which income is reported in column (E) of Part VII contributed importantly to the accomplishment of the organization's exempt purposes (other than by providing funds for such purposes) See Statement 16

part p( Information Regarding Taxable Subsidiaries and Disregarded Entities (See page 32 of the instructions ) p) B C D E)

Name, address, andEIN of corporation, Percentage of Nature ul activities Total income En] o(year paAneishio.ordis2aardedentiDr ownershi p interest assets

N/A ---

(a) Did the organization, during the year, starve any funds directly or urich rec

(G) Did the organization, during the year, pay premiums directly or indirectly,

Please Sign Here

3301 WOODBURN RD, ANNANDALE VA 22003 EDICAL SERVICES 2958554 . Total number of others receiving over $50,000 for professional services Do- 250 zxaioiA,-zz m LHA For Paperwork Reduction Act Notice, see the Instructions for Farm 990 and Form 990-EZ Schedule A (Form 990 or 990-EZ) 2002

7 11001027 746301 hosp 2002 .06000 INOVA HEALTH CARE SERVICES Fi0SP,1

scHeouLFa Organization Exempt Under Section 501(c)(3) OMB No 15d}0047

(Forth 990 or 090-EZ) (Except Private Foundation) and Section 501 (e), 501(1), 501(k), 501(n), or Section 4947(a)(1) Nonexempt Charitable Trust

2002 DepenrrcntoflnaTtifury Supplementary Information-(See separate instructions.) Intemel Rsamue swipe b. MUST he completed by tie above organizations and attached to their Form 990 or 990-E2 Name otthe organization Employer Identification number

INOVA HEALTH CARE SERVICES 54 0620889 Part 1 Compensation of the Five Highest Paid Employees Other Than Officers, Directors, and Trustees

(S ee pope 1 of the instructio ns List each one If there are none, entei 'None ') uo~~ ~o (e) Expense (a) Name and address at each employee paid (h) Title and average hours (a~ co~WCu

more than E59,000 Per week devoted to ([) Compensation o ~'~

j_ a °"~°^' account and othe .

nnsihnn .. .m ..,~.u~~ allnwanrnc

GARY MAGRAM=-M-D_-----------------]PHYSICIAN

FAIRFAX HOSPITAL

JAMES PIPER, M . D . MEDICAL DRTR

FAIRFAX HOSPITAL 40+HRS

JOHANN JONSSON, M .D . IR-TRANSPLT

FRED MECKLENBURG, M .D . HRMAN-OBGYN

FAIRFAX HOSPITAL 140+HR5 348

SAMIR FAKHRY, M .D .

FAIRFAX HOSPITAL 40+HRS 329 388 . 36 233 . Total number of other employees paid over $50.000 " 2608 Pact II Compensation of the Five Highest Paid Independent Contractors for Professional Services

(See pope 2 of the instruct ions List each one (whether individuals or firms) It there are none, enter'NOne')

(a) Name and address n1 each independent contractor paid more than $50,000 fib) Type of service (c) Compensation

PROGRESSIVE - NURSES STAFFING

CROS'u COUNTRY HEALTHCARE

O . BOX D860594, ORLANDO . FL 32886 MEDICAL SERVICES 14655

AMERICAN MEDICAL LABORATORIES

P .O . BOX 221830 . CHANTILLY . VA 20151 MEDICAL SERVICES 4079481 .

AMERICAN MOBILE NURSES HEALTHCARE

GPD P .O . BOX 5389, NEW YORK, NY 10087 CURSE STAFFING 13938452 .

CARDIOVASCULAR AND THORASIC SURGERY ASSOC PC

11001027 746301 hOSp 2002 .06000 INOVA HEALTH CARE SERVICES HOSP,

Schedule A(FOrm990or990-EZ)2002 .CNOVA HEALTH CARE SERVICES 54-0620889 Page2

Part III Statements About Activities (Sae page 2 of the instructions) Yes NO

1 During tie year, has the organization attempted to influence national, state, or local legislation, including any attempt to influence public opinion on a legislative matter or referendums If Yes,' enter the total expenses paid or incurred in connection with the lobbying activities t a a 2 0 , 7 3 3 . (Must equal amounts on line 38, Part VI-A,

or line i of Part VI-B ) 1 X

Organizations that made an election under section 501(h) by filing Farm 5768 must complete Part VI-A Other organizations checking Yes; must complete Pad VI-13 AND ,ittach a statement prying a detailed descnption of the lobbying activities

2 During the year, has the organization, either directly or Indirectly . engaged in any of the following acts with any substantial contributors, trustees, directors, officers, creators, key employees, or members of then families, or with any taxable organization with which any such person is affiliated as an officer, director, trustee, majority owner, or principal beneficiary? (II the answer to any question is 'Yes," attach a detailed statement explarring the transactions )

a Sale, exchange or leasing of propeAy7 2a X

6 Lending of money or other extensor of credits 26 X

s Furnishing otpoods,services or tacildies9 Zc X

O Payment of compensation (or paymnnl or reimbursement of expenses d more than $1,000) See Part V, Form 990 2d X

e Transfer of any part of its income or assets 2e X

3 Does the organization make grants fir scholarships, fellowships, student loans, etc 7 (See Note below ) 3 X

4 Do you have a section 403(b) annwly plan for your employees 4

Note Attach e statement to explain now the organization determines that individuals or organizations receiving grants or loans from it in furtherance of its chentabln programs 'qualify' to receive payments

part .iv Reason f 0r Non-Private Foundation Status (See pages 3 through 5 of the instructions

The oigani:ation is not a private foundation because d is (Please check only ONE applicable box )

5 [::] A church, convention of churches or association of churches Section 170(b)(1)(A)(i) 6 D A school section 170(bi(1)(A)(u) (Also complete Pad V ) 7 ~X A hospital or a cooperative hospital service organization Section t70(b)(t)(A)(ni)

8 ~ A Federal, stale, or local government or governmental unit Section 170(b)(1)(A)(v)

9 ~ A medical research organization operated in conjunction with a hospital Section 170(b)(1)(A)(w) Enter the hospital's name, airy,

and stale 10 D An organization operated for [he benefit of a college or university owned or operated by a governmental unit Section 170(b)(1)(A)(rv)

(Also complete the Support Schedule in Part IV-A ) 11a [~ An organization that no,mally receives a substantial part of its support from a governmental unit or tram the general public

Section 170(b)(1)(A)(vi' (Also complete the Support Schedule in Part IV-A ) 11b ~ AcommunitytruStSecIion170(b)(1)(A)(vi)(AlsocompletelheSupporlSChedulainPartIV-A) 12 ~ An organization that normally receives (7) mare than 3310% of it support from contributions, membership fees, and gross

receipts from activities related to its charitable, etc , functions - subject to certain exceptions, and (2) no more than 33 1/3% of

its support from gross iiveslment income and unrelated business taxable income (less section 511 tax) from businesses acquired

by the organization attei June 30, 1975 See section 509(a)(2) (Also complete the Support Schedule in Pan IV-A

13 El An organization that is riot controlled by any disqualified persons (other than foundation managers) and supports organizations described in

(1) lines S through 12 above or (21 section SOt(c)(4) (5) or (6) d they meet the teal of section 509(a)(2) (See section 509(a)(3) ) Prov de the following information about the supported organizations (See page 5 of the instructions )

Line (a) Name(s) of supported organization(s) (b) from a6ovar

10 [] An organization orpani. ed and operated to test for public safety Section 509(a)(4) (See page 5 of the instructions ) Schedule A (Form 990 or 990-EZ) 2002

773711 01 Z: 0.7

Schedule AffOrm990or990-E2)2002 [NOVA HEALTH CARE SERVICES 54-0620889 Page 3

p~ ~y.p SuppoA Schedule (Complete only if you checked a box on line 10, 11, or 12 ) Use cash method of aecountmg N/A Note You may use . he worksheet in the instructions for convertin from the accrual to the cash method of accounting

Calendar year~orfiscal year Geglnring Ink 1 " (a) 2001 (b) 2000 (c) 1999 (A) 1998 (e) Total 5 Gifts,pranis,andcontributions

received (DO not include unusual grants See line 28 )

16 Members hip fees received 17 Gross receipts from admissions,

merchandise sold or services performed, or furnishing of facilities m any activity that is related to the organization's ehantable,etc,purpose

18 Gross income tram interest, dividends, amounts received from payments on securities loans (sec lion 572(a)(5)), rents, royalties, and unrelated business taxable income (less section 511 fazes) from businesses acquired by the organization after June 30, X975

19 Net income from unrelated business activities not included in line 18

'j0 Tax revenues levied for the organization's benefit and either paid to tt or expended on its behal f

21 The value of services or facilities furnished to the organization by a governmental unit without charge Do not include the value of services or facilities generally furnished to the public without charge

2'j Other income Attach a schedule Do not include gain or (loss) from sale of capital assets

23 Total of lines 15 through 22 0 .1 0 . 0 . 0 . 24 Line 23 minus line 17 25 Enter 1% of line 23 26 Orpunl2atlons described on Ilne :,10 or 11 a Enter 25'o of amount in column (e) line 24 . 2fia NBA

h Prepare a list far your records to Mw the name of and amount contributed by each person (other than a governmental unit or publicly supported orpani, ahon) whose total gifts for 1998 through 200 exceeded tie amount shown in line 26a

Do not file this list with your rate rn Enter the sum of all these excess amounts " 26b N ~A

s Total support for section 509(a)( I) test Enter line 24, column (e) " 26c N/A

d Add Amounts tram column (e) for lines 18 19 22 26b " 26a N/A

e Public support (line 26C minus line 26d total) 1 26e NBA

I Public support percentage (line 26e (numerator) divided by line 26s (denominalor)l " 261 N/A ^b

27 Organizations described an line 12 a For amounts included in lines 15, 16, and 17 that were received from a'Gisqualdied person ; prepare a list for your

records to show the name at and total amounts received in each year from, each 'disqualified person Du not file this list with your return Enter the sum of

such amounts for each year (2001) (2000) (1999) (1998)

b For any amount included in line 17 that was received from each person (other than 'disqualified persons'), prepare a list for your records to show the name of,

and amount received for each year, that was more khan the larger of (7) tea amount on line 25 for the year or (2) $5,000 (Include in the list organizations

described in lines 5 through 11, i5 well as individuals ) Do not file this list with your return After computing the difference between the amount received and

the larger amount described in ( I) or (2) enter the sum of these differences (the excess amounts) for each year (2001) (2000) (1999) (1998)

c Add Amounts from column (e) for lines 15 16 17 20 21 1 27t NBA

O Add Line 27a total and line 27b total " 27d N / A

e Public support (line 27c total mucus line 270 total) 1 27e N/A

I Total support for section 509(a)i 2) test Enter amount on line 23, column (e) 1 271 N / A

p Public support percentage (line 27e (numerator) divided by line 271 (denominator)) 1 27 N/A

h Investment income percentage line 78 column e numerator divided b line 271 denominator 1 27h NBA

28 Unusual Grants For an organiz3lion described in line 10, 11 . or 12 that received any unusual grants during 1998 through 2007 prepare a list for Your records to show, far each year [he name of the contributor, the date and amount of the grant and a brief description of the nature of tie grant Do not 1118 this list with your return Do not include these grams in line 15

22121 012247 - ScneOUleA(FOrtn990or890 ED2002

2002 .06000 INOVA HEALTH CARE SERVICES HOSP 1 11001027 746301 hosp

Schedule A (Form 990 or 990-EZ) 2002

No

34 a Does the organization receive any financial aid or assistance from a governmental agency 6 Has the organization's right to such aid ever been revoked or sus0ended9

If you answered 'Yes'to either 34,i or b, please explain using an attached statement 35 Does the organization certify that it has complied with the applicable requirements at sections 4 01 through 4 OS of Rev Prac 75.50,

7975.2 C B 587, covering racial nondiscrimination If'NO ; attach an explanation Schedule A (Form 990 or 990-EZ) 2002

10

2002 .06000 INOVA HEALTH CARE SERVICES HOSP 1 11001027 746301 hosp

)nnalre (See page 7 of the instructions ) Y by schools that checked the bi

29 hoes the organization have a racially nondiscriminatory policy award students by statement in its charter bylaws, other governing instrument, or in a resolution of its governing body

30 Does the organization include a statement of its racially nondiscriminatory policy toward students in all its brochures, catalogues and other written communications with the public dealing with student admissions programs, and scholarships

31 Has the organization publicized its racially nondiscriminatory policy through newspaper or broadcast media during the period of sOlicilalion for students, or during the registration period it it has no solicitation program, in a way that makes the policy known to all parts of the general common ty it serves it Yes; please describe, if 'No,' please explain (If you need more space, attach a separate statement )

32 Does the organization maintain the following a Records indicating the racial composition of the student body, faculty, and administrative statt7 h Records documenting that scholarships and other financial assistance are awarded on a racially nondiscnminatory basis e Copies of all catalogues, brochure' ., announcements, and other written communications to the public dealing with student

admissions, programs, and scholarships d Copies of all material used by tie organization or on ids hehalllo solicit contributions7

It you answered 'NO'to any of the above, please explain (It you need more space, attach a separate statement )

33 Does the organization discriminate by race in any way with rasped to a Students' rights or pnvileges9 6 Admissions policies e Employment al faculty or administrative slatf9 d Scholarships or other financial as:islance9 e Educational policies f Use of facilities? p Athletic programs9 If Other extracurricular activities9

If you answered 'Yes'to any of thf, above, please explain (If you need more space, attach a separate statement j

4

173131 01 22 03

990or990-EZ)2002 CNOVA HEALTH CARE SERVICES Lobbying Expenditures by Electing Public Charities (see papa 9 of the instructions) (To be completed ONLI by an eligible organization that filed Form 5768)

A

1

41

42 as 0 44

Caution If there is en amount on either 6ne 43 or

Lobbying Expenditures During 4-Year Averaging Period

Calendar year (or (a) (b) W (d) (a) Ilssal year beginning In) 1 2002 2001 2000 1999 Total

45 Lobbying nontaxable amount l 000 000 . 1 1 0-0-0- 1 0-00 . 1 000 000 . 1 000 000 . 4 , 000 , 000 .

46 Lobbying taming amount X50% ofline ese 6- 1 0-0-0- 1 0-0-0 .

47 iotTotal lobbying ex penditures 20 , 733 . 70 , 471 . 64 , 086 . 76 , 339 . 731 629 .

48 Grassroots nontaxable amount 250 000 . 250 000 . 250 000 . 250 000 . 1, 000,000 .

49 Grassroots ceiling amount (1500/, otline 48e 1 ,500,000 .

50 Grassrools lobbying expenonures 0 . 0 . 0 .

Part YI "B Lobbying Activity by Nonelecting Public Charities (For reporting only b y organizations that did not complete Part VI-A) (See page 11 of the instructions ) N/A

During the year, did the organization attempt to influence national, state or local legislation, including any attempt to Yes No Amount influence public opinion on a legislative matter or referendum through the use of a volunteers b Paid staff or management (Include compensation in expenses reported on lines C through A ~ e Media advertisements G Mailings to members, legislators, or the public e Publications, or published or broadcast statements 1 Grants to other organizations tar lobbying purposes p Direct contact with legislators, their staffs government officials, or a lepislatrve body h Rallies, demonstrations seminars, conventions, speeches, lectures or any other means I Total lobbying expenditures (Add lines s through h ) ~ ~

0It'Yes'ta any of the above, alSO attach a statement giving a detailed description of the lobbying activities

o;3ZZ'au Schedule A (Farm 990 or 990-EZ) 2002 11

11001027 746301 hosp 2002 .06000 INOVA HEALTH CARE SERVICES HOSP-1

(a) (h) Affiliated group To be completed for ALL

totals electing organizations

0

1 a 1 X I if the nrnaniratinn hnlnnns in an affiliated orouo Check

Limits on Lobbying Expenditures

term 'expenditures' means amounts paid or incurred

36 Total lobbying expenditures to influence public opinion (grassroots lobbying) 37 Total lobbying expenditures to influence a legislative body (direct lobbying) 38 Total lobbying expendAures (add lint s 36 and 37) 38 Olnerecemptpurposeexpenddures 40 Total exempt purpose expenditures (add lines 38 and 39) 41 Lobbying nontaxable amount Enter ,heamount from lhefollowing table -

If the amount on line 40 Is - Tie lobbying nontaxable amount Is -

Not over $5100 000 10% of the amount on line <0

WerS5C0,000Winotwn31000000 5100,OOOplus 75%olNeexcess overf500000

Over S10W0000ut not over 31,500000 $175 000 plus 10% of the exms over $1000,000

O+erS1500000EUtnotrntt317,000,000 SI25000plus 5%ollneexwaovaf1,50D,000

0, en $17 000 000 S1 000 000

42 Grassroots; nontaxable amount (entE r 25°h of line 41) 03 Subtract line 42 from line 36 Enter 0- A line 42 is mare khan line 36 44 Subtract line 41 from line 38 Enter 0- if line 4 1 i5 mare khan line 38

1 .000 .000 .

4-Year Averaging Period Under Section 501(h) (Some organizations that made a section 501(h) election do nod have to complete all of the five columns

below See the instructions tar lines 45 through 50 on page 11 of the instructions )

ScheaWen(FOrm990or990-EZ)2002 :_NOVA HEALTH CARE SERVICES 54-0620889 Page 6

Part VII Information Regarding Transfers To and Transactions and Relationships With Nonchantable Exempt Organizal ions (See pane 12 of the instructions

51 Did the reporting organization directly or indirectly engage in any of the following with any other organization described in section SOt(c) of the Code (other than section 501(c)(3) organizations) or in section 527 relating to political organizations9

a 1 ransfers from tie reporting organ zalion to a noncharitahle exempt organization of Yes No 51a(1) X (1) Case

(II) Other assets a(ii) X

b Other transactions (I) Sales or exchanges o1 assets %nih a nonchantable exempt organization 6(1) X

III) Purchases of assets from a nancharitahle exempt organization b(II) X

(III) Rental offacilities,eqwpment,orotherassels b(ill) X (Iv) Reimbursement arrangements G(Iv) X (v) Loans or loan guarantees hlv) X (vq Performance of services or mumhership or fundraising solicitations b(vi) X

e Sharing of facilities, equipment, mauling lists, other assets, or paid employees s X d If tie answer to any of tie above is 'Yes ; complete the following schedule Column (b) should always show the fair market value of the

goods, other assets, or services given by lie reporting organization It the organization received less than fair market value in any [ransiction or sharing arrangement, show in column (d) the value of the goods, other assets or services received N/A

(a) (b M (it) I. no n

I I table exempt organization Descn ption of I ransters, transacho n s and sha ring a rrangemen is i o Amoun involved Name of nonchan

52 a Is the organization directly or mduectly affiliated with, or related to, one or more tax-exempt organizations described m section 501(c) of the Codo (other than section 507(c)( :)) Or in section 5277 10' EJ Yes No

IZ 2002 .06000 INOVA HEALTH CARE SERVICES HOSP 1 11001027 746301 hosp

bNOVA HEALTH CARE SERVICES 54-0620889

Total to Form 990, P«rt I, line 6b 8,045,807 .

15 Statement s) 1, 2, 3 2002 .06000 INOVA HEALTH CARE SERVICES HOSP1 11001027 746301 hosp

Form 990 other Investment Income Statement 1

Descripti.on Amount

PREMIER PURCHASING L .7D . INTEREST 53,122 . FAIR OAKS MEDICAL PLA'3A L .P . INTEREST 91 . AMHS HERITAGE, LLC INTEREST 2,159 . Potomac Inova LLC Interest 12,221 . FAIR OAKS MEDICAL PLAZA L .P . 81,483 . MEDICAL TRANSPORT LLC INTEREST 57 . MEDICAL TRANSPORT LLC <81,004 .> Potomac Tnova LLC 35,220 .

Total to Form 990, Part I, line 7 103,349 .

Form 990 Rental Income Statement 2

Activity Gross Kind and Location of Property Number Rental Income

OFFICE BUILDING RENTAL 1 10,526,032 .

Total to Form 990, Part I, line 6a 10,526,032 .

Form 990 Rental Expenses Statement 3

Activity Description Number Amount Total

DIRECT & :CNDIR . EXP . FOR OFFICE RENTALS 8,045,807 .

- SubTOtal - 1 8,045,807 .

Form 990 Gain (Loss) From Publicly Traded Securities

Description

LOSS FROM POTOMAC LLC LOSS FROM MEDICAL TRANSPORT LLC LOSS FRO[4 FAIR OAKS MEDICAL PLAZA LLC LOSS FROM AMHS HERITAGE LLC GAIN FROM PREMIER PURCHASING LLC

To Form 990, Part I, line 8

0 . 17 . 0 .

0 . 15,344 . 0 .

19,195 . 0 . 0 .

19,195 . 22,450 . 0 .

<15,344 .>

19,195 .

<3,255 .>

Form 990 Other Changes in Net Assets or Fund Balances Statement 5

Description

PARTNERSHIP INTEREST PARTNERSHIP GAIN PARTNERSHIP INCOME UNREALIZED GAIN/LOSS WRITEOFF INTERCOMPANY BALANCE EQUITY IN SUBS UNRESTRICTED FUND DONATIONS TRANSFER OF UNRESTRICTED AND RESTRICTED FUND BALANCE OTHER MISC CHANGES PENSION LIABILITY ADJUSTMENT

Total to Form 990, Part I, line 20

<67,650 .> 3,255 .

<2,145,662 .> <22,341,813 .>

622,052 . <13,636,442 .>

362,615 . 11,644,343 .

<35,217 .> <90,166,185 .>

<115,760,704 .>

16 Statement s) 4, 5 2002 .06000 INOVA HEALTH CARE SERVICES HOSP 1 11001027 746301 hose

INOVA HEALTH CARE SERVICES

Gross Cost or Expense Sales Price Other Basis of Sale

0 . 4,827 . 0 .

0 . 2,262 . 0 .

54-0620889

Statement 4

Net Gain or (Loss)

<4,827 .>

<2,262 .>

<17 .>

Amount

Form 990

Program Management Services and General

Food Physician's Fees Purchased Goods & Services Insurance Advertising Other (MLsc) Taxes & Licenses InformatLOn System Cost Vehicle ]Expense Income Tax Expense Charitable Contributions and Portfolio Expenses 4,874 . 4,874 .

Statement 7

Explanation

TO MAINTAIN AND OPERATE HOSPITALS AND PERFORM OTHER ACTIVITIES TO PROMOTE THE GENERAL HEALTH OE' THE COMMUNITY

Form 990 Government Securities Statement 8

State and Total Gov t Local Govt Securities

136,988,930 . Total to Form 990, line 54, Col B 136,988,930 .

17 Statement s) 6, 7, 8 2002 .06000 INOVA HEALTH CARE SERVICES HOSP 1 11001027 746301 hosp

FNOVA HEALTH CARE SERVICES

Description

(A)

Total

3,021,187 . 18,486,785 .

35,654,591 . 1,383,613 . 2,823,846 .

27,654,905 . 1,035,269 .

6,912,898 . 42,732 .

<12,797 .>

Other Expenses

2,852,709 . 168,483 . 17,847,932 . 638,853 .

24,523,280 . 11,131,311 . 1,168,893 . 214,720 .

877,610 . 1,946,236 . 21,794,334 . 5,860,571 .

377,283 . 657,986 .

75,311 . 6,837,587 . 42,182 . 550 .

<12,797 .>

Total to Fm 990, In 43 97,007,903 . 69,559,529 . 27,448,374 .

Form 990 Statement of Organization's Primary Exempt Purpose Part III

54-0620889

Statement 6

(D)

Fundraising

Description

Held by Bond Trustee & Malpractice trust

U .S . Government

136,988,930 . 136,988,930 .

Other Investments

Description

Cost

Total to Form 990, Part IV, line 56, Column H 2,318,199 .

Total to Form 990, Part Iv-A 364,237,838 .

18 Statement s) 9, 10, 11, 12 2002 .06000 INOVA HEALTH CARE SERVICES HOSP 1 11001027 746301 hosp


Form 990

INVESTMENT IN JOINT VENTURES AND SUBS

Valuation Method

54-0620889

Statement 9

Amount

2,318,199 .

Form 990 Other Assets Statement 10

Description Amount

MEDICREDIT NOTES RECEIVABLE 12,464,090 . UNAMORTIZED BOND COSTS 4,525,476 . OTHER ASSETS 12,776,042 . DUE FROM SUBSIDIARIES 497,884,513 .

Total to Form 990, Part IV, line 58, Column B 527,650,121 .

Form 990 Other Liabilities Statement 11

Description Amount

THIRD PARTY SETTLEMENTS 8,673,971 . NOTES PAYABLE AND OTHER 3,687,825 . CURRENT PORTION LT DEBT 147,670,000 . SELF INSURED LIABILITY 8,397,030 . OTHER LIABILITIES 40,151,923 .

Total to Form 990, Part IV, line 65, Column B 208,580,749 .

Form 990 Other Revenue Not Included on Form 990 Statement 12

Description Amount

REVENUE OF OTHER ENTITIES REPORTED ON AUDIT 364,237,838 .

INOVA HEALTH CARE S?RVICES 54-0620889

Form 990 Part V - List of Officers, Directors, Statement 14 Trustees and Key Employees

19 Statement s) 13, 14 2002 .06000 INOVA HEALTH CARE SERVICES HOSP-1 11001027 746301 hosp

Form 990 Other Expenses Not included on Form 990 Statement 13

Description Amount

EXPENSES OF OTHER ENTITIES REPORTED ON AUDIT 417,439,816 .

Total to Form 990, Part IV-B 417,439,816 .

Name and Address

UNCOMPENSATED OFFICERS AND DIRECTORS

Mary B . Agee 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Glenna R . Andersen 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Carl L . Biggs 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Fred L . Bollerer 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Patricia Broussard 2990 `i'ELESTAR COURT FALLS CHURCH, VA 22042

Caren DeWitt 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Cleveland Francis 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Employee Title and Compen- Ben Plan Expense Avrg Hrs/Wk sation Contrib Account

0 . 0 . 0 .

DIRECTOR LESS THAN 40 0 . 0 . 0 .



SECRETARY LESS THAN 40 0 . 0 . 0 .




20 Statement s) 14 2002 .06000 INOVA HEALTH CARE SERVICES HOSP-1 11001027 746301 hosp


i Michael R . Frey 2990 TELESTAR COURT FALLS CHURCH, VA 2202

Penelope Gross 2990 TELESTAR COURT FALLS CHURCH, VA 22042

William Hazel 2990 TELESTAR COURT FALLS CHURCH, VA 22042

J . William Kilpatrick 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Alan E . Leis 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Dario O . Flarquez 2990 TELESTAR COURT FALLS CHURCH, VA 22042

John Maddox 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Richard E . Merritt 2990 TELESTAR COURT FALLS CHURCH, VA 22092

Frederick W . Sachs 2990 TELESTAR COURT FALLS CHURCH, VA 22092

Sudhakar Shenoy 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Leroy F . Smith 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Joel Temme 2990 TELESTAR COURT FALLS CHURCH, VA 22042

Winston Ueno 2990 TELESTAR COURT FALLS CHURCH, VA 22042

54-0620889










CHAIRMAN LESS THAN 40 0 . 0 . 0 .


SECRETARY LESS THAN 90 0 . 0 . 0 .


54-0620889

0 . 0 . 0 .

0 . 0 . 0 .

DIRECTOR LESS THAN 40

Totals Included on Form 990, Part V

Line Explanation of Relationship of Activities

93a Patient service revenue generated by performance of exempt medical services enumerated in the "Report of Program and Community Services" (See Attached) . Partnership income related to program services . Allocable share of partnership income from materials management and group purchasing programs structured to reduce the cost of medical related supplies purchased by the Hospitals .

21 Statement s) 14, 15, 16 2002 .06000 INOVA HEALTH CARE SERVICES HOSP 1 11001027 746301 hosp


Thomas Wright 2990 TT'LESTAR COURT FALLS CHURCH, VA 22012

Form 990 Identification of Related Organizations Statement 15 Part VI, Line 80b

Name of Organization Exempt NonExempt

INOVA HEALTH SYSTEM FOUNDATION X JEFFERSON HOSPITAL, INC . X IMANCO, INC . X INOVA HEALTH SYSTEM SERVICES INOVA HOME CARE X INOVA HEALTH PROFESSIONALS X INOVA PHYSICAL REHABILITATION SERVICES X UMC HOLDINGS, INC . X HEALTHCARE PARTNERSHIP OF THE CAPITAL REGION X INTEGRATED PHYSICIAN SERVICES }{ INOVA MEDICAL FOUNDATION X INOVA HOLDINGS, INC . g

Form 990 Part VIII - Relationship of Activities to Statement 16 Accomplishment of Exempt Purposes

io-xios LriA For Paperwork R,fduclion Act Notice, see separate instructions Form 4582 (2002) 22

11001027 746301 hosp 2002 .06000 INOVA HEALTH CARE SERVICES HOSP1

OMB NO

20 1571017

Forth 4562 2

Depreciation and Amortization 99o- DepertmxitolNa treasury (Including Information on Listed Property) intanu aaenu. Swim " See separate instructions " Attach to your lax return sequmm No 67 Name(e) III~ on return Business or ecilvlty to rTicn this form War" laenulying numGer

INOVA HEALTH CARE SERVICES orm 990-T Pa ge 1 54-0 62088 Par( I Election To Expense Certain 1 anpihle Pro pe rty Under Section 179 Note If you have an listed prope rty , complete Part V before you complete Part I

0 7 Maximum amount See instructions for a higher limit for certain businesses 1 24,0 2 Total cost of section 179 property placed in service (see instructions) 3 Threshold cost of section 179 property before reduction in limitation 3 $200,000 4 Reduction in limitation Subtract line 3 from line 2 If zero or less, enter -0 <

(e) Defcnpllon of pmperty I (b) Cost (business use only) I (c) Elwtw cost

7 fisted property Enter amount from line 29 8 Total elected cost of section 17<) property Add amounts in column (c), lines 6 and 7 9 Tentative deduction Enter the smaller of line 5 or line 8 10 Carryover of disallowed deduction from line 13 of your 2001 Form 4562 71 Business income limitation Enter the smaller of business income (not less than zero) or line 5 12 Section 179 expense deduction Add lines 9 and 10, but do not enter more than line 11 13 Carryover of disallowed deduction to 2003 Add lines 9 and 10, less line 72 . 13 Note Do not use Part 11 or Part 111 6a1ow for listed property Instead, use Part V

14 Sndlei deprecleLOn allowance for puelifiell property (oNer than listed property) plece0 In service during the W year (sea, Instructions)

15 Property subject to section 168,x(1) election (see instructions)

17 MACRS deductions for assets elated in service in tax years beginning before 2002 17 14 18 II you are electing under section 168(1)(4) to group any assets placed in service during the tax

aecuon o - hssMs rIecea m oarvica wnn cvuc i nx Your usin mn venura3 ve roc.nuon o -iem (D) Month eM (c) Bass; for a.ohlo, .uon

(N Classification of property year placaC Ibualnma/InvoMent use ~~ P~m (e) Convention (~ Method ~ Oeqrene4on deduction In !lNICA only 707 Instructions)

79a 3 year property

b 5 year property

c 7 year property `

d 10 year property

e 15 Year property

1 20 year progeny

2aearpropeAy 25 rs S/L

/ 275 rs MM S/L h Residential rental property ~

27 5 rs MM S/L

/ 39 rs MM S/L i Nonresidential real property ~

MM S/L Section C - Assets Placed in Service During 2002 Tax Year Using the Alternative Depreciation System

20e Class life I I I S/L I b 12 year 12 yrs SQL

e 40 ear ~ 40 yrs MM S/L

P8rt / Summary (See instructions )

21 Listed property Enter amount from line 28 21

22 Total Add amounts from line' 2, lines 14 though 17, lines 19 and 20 in column (g), and line 21 . Enter hors and on the appropr ate lines of your return Partnerships and S corporations - see instr 22 14,861 .

23 For assets shown above and placed in service during the current year, enter the

Form 4562 (2002) Page 2 ~Listed Property (Include automobiles, certain other vehicles, cellular telephones, certain computers, and property used for eilertanment,

recreation, or amusement Note For any vehicle !o, which you are using the standard mileage rate or deducting lease expense, complete only 246,24b, columns (a) through (c) of Section A, all o/ Section B, and Section C d applicable

Section A - Depreciation and Other Information (Caution See instructions !or limits for passenger automobiles) Me Do you have evidence to suooort the 6usinesslnveslment use claimad9 n Yes n No 24h If 'Yes .' is the evidence written? F-1 Yes n Nn

fill lei (d) lei (Q lei IhI Date Business/ mr aey~.,em~ ElecteU Type of property laced in investment cost or ~o~si~~y~~~~~ ~ Recovery Method/ Depreciation

(list vehicles test ) service ~ use percentage

~

other basis U� o�,Y) ~ Penod convention deduction sectcosi 79

25 Special depreciation allowance for qualified listed property placed in service during the tax

43 Amortization of costs that beg 3n before your 2002 tax year 43 44 Total Add amounts in column (Q See instructions for where to report 44

2,6252,o zo-oz Farm 4582 (2002) 23

11001027 746301 hOSp 2002 .06000 INOVA HEALTH CARE SERVICES HOSP-1

27

28 Add amounts in column (h), lines 25 through 27 Enter here and on line 21, page 1

29 Add amounts in column 11 . line 26 Enter here and on line 7. ogee 1

Section B - Information on Use of Vehicles

Complete this section for vehicles wied by a sole proprietor, partner, or other more than 5% owner,' or related person Ii you provided vehicles to your employees, first answer the questions in Section C to see if you meet an exception to completing this section for those vehicle3

(a) I (b) (c) I (d) I (e) 1 10 30 Total business/nvestment miles driven during the

year (do not include commuting m lee) 31 Total commuting miles driven during the year 32 Total other personal (noncommuting) miles

driven 33 Total miles driven during the year

Add lines 30 through 32 34 Was the vehicle available for personal use

during off-duty hours? 35 Was the vehicle used primarily by a more

than 5% owner or related person? 38 Is another vehicle available for personal

use? Section C - questions for Employers Who Provide Vehicles for Use by Their Employees

Answer these questions to determine A you meet an exception to completing Section B for vehicles used by employees who are not more than 5% owners of related persons 37 Do you maintain a wntten police statement that prohibits all personal use of vehicles, including commuting, by your Yes N

employees? 38 Do you maintain e written polic i statement that prohibits personal use of vehicles, except commuting, by your

employees? See instructions for vehicles used by corporate officers, directors, or 1 % or more owners 39 Do you treat all use of vehicles by employees as personal use? 40 Do you provide more than five iehicles to your employees, obtain information from your employees about

the use of the vehicles, and retain the information received? 47 Do you meet the requirements concerning qualified automobile demonstration uses

Note If your answer to 37, 38, 39, 40, or 47 is "Yes," do not complete Section B (or the covered vehicles ~~-Amortization

lal Ibl (cl (dl (e) In :e~onMntraom :e~on Art nNZab~eDeanlptbnolwsb meum9aom nNZab~e coo. McN

begins srnoum e«uon red00upemiqp brthis yaer

42 Amortnanon of costs that heoms dunno vour 2002 tax veer

-COMPENSATION FROM IiJOVn HEALTH CARE SE°V1CES-

(E) (C) (D) (E) EXPENSE ACCOUNT CONTRIBUTIONS EXPENSE ACCOUNT

AND OTHER TO EMPLOYEE AND OTHER ALLOWANCES COMPENSATION BENEFIT PLANS ALLOWANCES

43 634 0 0 0

0 6,779 0 0

~~ ~ssmmryo~weeo w),

(NOVA HEALTH CARE SERVICES Compensated Officers EMPLOYER ID# 54-0620889 ATTACHMENT TO IRS FORM 990, PART V LIST OF OFFICERS DIRECTORS, TRUSTEES AND KEY EMPLOYEES FOR THE YEAR ENDED f2/3f/02

--0OMFeiJSnTICP. FFOtd 10.",M:CO, !^:C 4 RELATED ORGANVATION--IDi 54-1340725

(A) (B) (C) (D) CONTRIBUTIONS

TITLE AND TO EMPLOYEE NAME AND ADDRESS AVERAGE HRSNVK COMPENSATION BENEFIT PLANS

J Knox Singleton President S65221 39,058 2990 Telestar Court 60+ Falls Churcn, Virginia 220r2

Jolene Tornabeni Exec Vice President, COO 425 885 87,665 2990 Telestar Court 60- Falls Church, Virginia 22042

Richard C Magenheimer Sr Vice President CFO 437328 69851 2990 Telesiar Court 60t Falls Church Virginia 22042

James Hughes Senior Vice President 308896 57 715 2990 Telestar Court 60+ Falls Church Virginia 22042

Patrick Welters Senior Vice President 304 160 20 490 2990 Telesrar Court 60" Falls Church Virginia 22042

Ellen Menard Senror Vice President 238,500 50 452 2990 Telestar Court 60+ Fails Church, Virginia 22042

Shannon 5inclav Asst Secretary 283,632 24837 2990 Telestar Court 604 Falls Church Virginia 22042

26 902 0 0

79770 0 0

22 505 0 0

20 280 0 0

19,833 0 0

0

0

0

0

0

ATTACHMENT 1 TO PART V (NOVA HEALTH CARE SERVICES EIN 54-0620889 ATTACHMENT TO FORM 990, PART V, FOR THE YEAR ENDED 12131101

Inova Health System Foundation (IHSF) controls several healthcare organizations, including Inova Health Care Services (IHCS), a 501(c)3 organization established to maintain and operate hospitals and perform other activities to promote the general health of the community While members of our Boards of Trustees are not compensated certain board members either dire". or through their related organizations or individuals, provide services to Inova Health Care Services or other related companies A description of these relationships are rated below

ADDITIONAL FORM 990 SCHEDULE REFERENCE NAME POSITION DESCRIPTION OF SERVICES

75,000 21,215

75 000

70 000 15,650

50,000 6 667

14 610

60 000 18,983

IHCS IHCS

IHCS

IHCS IHCS

IHCS

IMCS

IHCS IHCS

Medical Stag President - loom Fairfaa Hospital Physician Semces

Medical Stall President - Move FairOaks Hospital

Medical Staff President - Inova Mt Vemon Hospital Physiaan Semces

Medical Staff President -Almandna Hospital

Fairtaz Hospital Clinic Services

loom Medical Affairs Council Chairman Rembursement of Expenses

Temme MD . Joel M Trustee, IHCS

Anderson M 0 Glenna R Trustee IHCS

Maddox M D John F Trustee IHSF

Sch A, Part III, Line 2d

Sch A Part III Line 2d

Sch A Pan III, Line 2d

H \TRUSTEEV'fRU5TE02 ds)FOUND


Sth A Part III Line 2d


Wright, M 0 , Thomas P Trustee IHCS

Hazel M D , William Trustee IHCS

Francs M D Cleveland Trustee IHCS

PAYING ORGANIZATION PAYMENTS

ATTACHMENT TO FORM 990 PART TV i2/3i/G2 AUDIT RECONCILIATION

- - - - - - -I s, - - fff

7770Y no b10 Don 711771 1111 11 in ISIOIII 11f7111 IL .1011 IIWf INI,I711 {71711 YH (IWl I7 D1 /7171 III4 7L1 171W r m

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INCOME (LOSS) FPOM OPEAATIONS

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F4hY VAUSn time.) oMy,

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Cable, Au Impnur d¢ We Y hl, ~udn

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TOTAL NON OYERAI ING

(fllP1175FS) ltVENUIS

NET INCOME (LOSS) BEFORE DISCOIRINUI'O UI'LRATIUNS

plrml~ epcmbm Gets in dilmommil

NPf INCOME (LOSSI

l UNSULIUA71N4 Sf"1 LMFNTS or OPERATIONS

[NOVA IItAL711 SYSfFJ.1 sweet. InNmuWl

Iv. IWW AYaWAe legalism ire'. Iv'. liable IwiWlb. SptimUlha Maiu,N EYMwbm .N Teub

Gm Scntn SentaCaywYbe IbYim" IK SP" k^ix, Cart Cem4WlyE,un

7RU 7110i "Be 10U1 ]001 ?We Tun 7001 7001 ' 71101 zoo] 7001 211112 2001 700! MII I(Gl 1001

N11011 sell 717 111181 illllfl W p Y7,Hf Will a b q f0 b 10 b b f11NAI IIAIa

%01f me to 771 3943 I9 710 217" 110 I ND 111 In so me Ilml no IT (a items (14610 line X171,

939116 ~sells Mile INOM Issue 117s. W777 Ybl Ill 1)t to me lease 1% 1n III mew) 111,171 ILIQA 1111!N

411051 )7111 I'll, T1171 ]1l1 1011 win A7/! fJW I'11 In 771 ! )777N I" IN

(/7111 I'll's 4.04 71 AI I)In IfYI/ LEI 77110 1 .11 777 101111 114, 11e A Illbll II, 'L1 11,67. Y71.1

Sip, 51 IL I b1 go, 71. up 7711 >Y1 L b 74U 7777 11 ~1 R9]I no)

If TO Home 161 1 in 1711 L m 1 .61 - 1 21 20 11,411

.1118 11 In 15%) 11 in 11, 19 JIM $136 IN 614 M )it

10 111 Ill l~l 11f I» IT IV It V! 10014 .1 Gl 711M 7177 ) 771 II YI 11 Us Ill 117 Ill lpl 11~ ~M 1 i1~ Tl 1 PI lT

L M7 51211 g07 4711 sell 100 (3611) 14,111 II 7N1 P &7p I IV X11 114 Itl - 38,714 11771

1711 see 71f me 11771 N7 I. IN) limit 7111 Illq 11 1A71 7Dt 7H1 (WI Yf

M ]f11 Jim, AIM Ifl IN, ! me 7114 7717 IIIILI now, It 7111 (IO9Iq .Ipi i

1'm11 117141 1113 .1

17 Il8q 17111 IIN, 11 11 41 .171) I TI 11 X711 III

31, 7111 (1719) 4115 (this 1N 11 201I 11110 I1 1111 1 711 (47 998) 71 On 110 IYJe 7 30, 1 M1 IN at) 471b

7m W ""q lwe 1, 13) 1 .1 . 17N 170111 111711 I . 7U11 7110 4.1611) 71"s w 1m1 71D1 A", 1111/11 I'm

TOTAL. 492,393,358

INOVA HEALTH CARE SERVICES E I # 54-0620889

STATEMENT 20 STATEMENTS ATTACHED TO AND MADE A PART OF FEDERAL EXEMPT ORGANIZATION INCOME TAX RETURN FOR THE YEAR ENDED DECEMBER 31, 2002

STATEMENT 16 FORM £90, PART II, LINE 42

DEPRECIATION IS COMPUTED USING THE STRAIGHT LINE METHOD OVER THE ESTIMATED USEFUL LIVES OF THE ASSETS

DEPRECIATION EXPENSE LINE 42 54,459,829

STATEMENT 17 FORM 990, PART IV, LINE 57

1213112002

LAND AND LAND IMPROVEMENTS 47,648,326

BUILDINGS 473,948,606

MAJOR MOVABLE EQUIPMENT 397,169,517

LESS ACCUMULATED DEPRECIATION (426,373,091)

THE ATTACHED "REPORT OF PROGRAM AND COMMUNITY SERVICES" IS SUBMITTED TO MEET THE REQUIREMENT OF IRS FORM 990, PART III - STATEMENT OF PROGRAM SERVICE ACCOMPLISHMENTS, FOR THE YEAR ENDED DECEMBER 31, 2702 .


TAX ID # : 54-0620889

o The Fairfax Hospital (Fairfax) o Mount Vemon Hospital (Mount Vernon) o Fair Oaks Hospital (Fair Oaks) o ACCESS of k2eston and ACCESS of Fairfax o Springfield I-lealthplex o Institute of Research and Education o American Medical Collections Bureau (AMCB) 0 Medicredit

(NOVA HEALTH CARE SERVICES REPORT OF PROGRAM AND COMMUNITY SERVICES

FOR THE YEAR ENDED DECEMBER 31, 2002

Ino-va Health Care Services ("IHCS", formerly Inova Health System Hospitals) is a not-for-profit corporation and a subsidiary of the parent organization, [nova Health System Foundation (Inova) (nova is a large healthcare system providing healthcare and related services throughout northern Virginia and the greater metropolitan Washington, D C area, including certain contiguous counties of Virginia and Maryland Both IHCS and Inova are operated for charitable, scientific, and educational purposes and are exempt from income tax under Section 501(c)(3) of the Internal Revenue Code

IFICS was specificall y chartered for the purpose of serving the health care needs of the community by establishing, maintaining, and operating hospital facilities, programs, and other shared service arrangements, carrying on health-related education activities, promoting and carrying on health-related scientific research, and engaging m activities designed and carved on to promote the general health of the community IHCS includes a centralized System Office and the various unincorporated and incorporated sub3idianes which are described below

The unmcorporated subsidiaries of IHCS include The Fairfax Hospital, Mount Vernon Hospital, Fair Oaks Hospital, ACCESS of Reston, ACCESS of Fairfax, and Springfield Healthplex The Institute of Research and Education is operated as a program of IHCS Also, American Medical Collections Bureau, a collection service, and Medicredrt, a financing service, are included under IHCS

1-ICS is also the parent company of the following incorporated subsidiaries Jefferson Hospital, Inc , was operated as a not-for-profit subsidiary of IHCS through June 30, 1993, when it ceased all operations due to lack of financial viability Jefferson filed its own tax return for 2002, and its operations are not included in IHCS's tax return

IHCS's 2002 tax return and this Report of Program and Community Services include the activities of its centralized System Office and the following facilities and programs

Fairfax's obstetric program is the largest such program in the mid-Atlantic region, now providing services for over 10,000 births each year Obstetric services are provided at Fairfax's state-of-the-art Women and Children's Center include- delivery services, inpatient and outpatient obstetrics/gynecologic surgery, and regular and special nursery care The Center includes northern Virgrua's only Level III (highest level) newborn intensive care unit, which is staffed around the clock by neonatology physicians and nurses specially trained m caring for premature and other newborns with medical problems In addition, Fairfax provides obstetric services to low-income patents though it Obstetrics/Gynecology Clinic

(NOVA HEALTH CARE SERVICES Page 2 2002 REPORT OF PROGRAM AND COMMUNITY SERVICES

PROGRAM SERVICES

Each of 1HCS's three operating hospitals provide general acute care services, including emergency facilities, inpatient and outpatient services, and a variety of ancillary and specialized services based on die needs of the community Services provided by these hospitals, the ACCESS facilities, and certain other programs of IHCS are described more fully below

The Fairfax Hospital is a 656-licensed bed tertiary care hospital providing comprehensive medical and surgical service,, which include emergency/trauma, cardiac, transplant, cancer, obstetric, pediatric, neonatal, and extensive outpatient services Fairfax is the home of the nationally-known Virginia Heart Center, the Fairfax Hospital for Children, northern Virginia's top-rated emergency and trauma center, and the state-of-the-art Women's and Children's Center In addition, Fairfax is as a teaching hospital providing clinical training through its medical residency, nursing, and paramedical education programs

Fairfax physicians are qualified m all mayor specialties and subspecialties, and the hospital operates several specialized regional medical referral centers which are described below

The Virginia Heart Center, established m 1987, provides a full range of advanced medical care, from diagnosis to treatment (including heart and lung transplants) and rehabilitation for cardiac patients of all ages The 1 10-bed Center provides three operating suites dedicated to cardiovascular surgery, cardiac cathetenzaUOn and elecvophysiology laboratories, and coronary care nursing units

The Cancer Center of Fairfax Hospital is a 32-bed inpatient medical oncology unit providing comprehensive diagnostic services, inpatient and outpatient surgical services, and nursing care for cancer patients, including specialized care for gynecologic cancer and pediatric patients Five of the Center's beds are available m support of the Center's autologous bone marrow transplant program In addition, the Center provides a full spectrum of support services to its patients, including the Life with Cancer program of educational and support groups The Center also conducts research and participates m studies in conjunction with university hospitals and other cooperative groups

In 2002, Mount Vemon had 8,809 admissions and 59,103 patient days Emergency room visits totaled 26,759, and i here were 4,380 outpatient and 2,413 inpatient surgeries performed during the vear

INOVA HEALTH CARE SERVICES Page 3 2002 REPORT OF PROGRAM AND COMMUNITY SERVICES

o Fairfax Hospital for Children is northern Virginia's only full-service pediatric program and is a regional referral center for more than 25 pediatric specialties and subspecialties, including pediatric emergency and trauma care, critical care, infectious disease, pulmonary disease, cardiac surgery, hematology and oncology, neonatology, pen-natology, infant apnea, physical medicine, and rehabilitation and speech and hearing therapy In addition to its neonatal mten:arve care unit, Fairfax operates the only pediatric intensive care unit m northern Virginia, providing 24-hour coverage for children with life-threatening illnesses or injuries There also is .i facial rehabilitation program for those needing pediatric plastic surgery

o The Emergency and Trauma Center at Faufax is state-of-the-art and is northern Virginia's only Level 1 trauma center Emergency medical specialists with expertise in trauma care treat every type of illness, injury, or life-threatening trauma In addition, Fairfax operates Inova Medical AvCare, a 24-hour emergency helicopter transport service

During 2002, Favfax had admissions of 50,672 and patient days of 252,177 Newborn deliveries were 10,763 Emergency room visits totaled 70,087 for the year, and there were 22,076 outpatient surgeries There were 15,883 inpatient surgery cases performed during the year

Mount Vernon Hospital is a 235-licensed bed, acute-care hospital serving southeastern Fairfax County Mount Vernon provides a full-service, 24-hour emergency department, a broad range of diagnostic services, a cardiac rehabilitation program for victims of heart disease, cardiac cathetenzation services, inpatient psychiatric services, and a specialized hyperbanc oxygen therapy program used to veal conditions requiring increased oxygen flow to body tissues, such as grafts and certain types of burns In addition, the hospital operates The Inova Center for Rehabilitation, a nationally-known accredited program providing inpatient and outpatient rehabilitative services

o The Inova Center for Rehabilitation provides comprehensive medical rehabilitation services to p~itients with severe head injuries, spinal cord injuries, strokes, multiple sclerosis, and other orthopedic and neurological disabilities These services are staffed by an interdisciplinary team which incudes physiatry, psychiatry, psychology, vocational counselling, physical therapy, occupational therapy, and nursing so that treatment can be individually tailored to meet the specific needs of each patent

American Medical Collections Bureau is an unmcorporated division of IHCS which provides collection services to Inova's hospitals and affiliates


Fair Oaks Hospital c; a 160-licensed bed general acute care hospital, which opened m 1987 to serve the growing communities m western Fairfax County, Virginia Fair Oaks provides a full-service 24-hom emergency department, a spectrum of diagnostic services, including full-body CT scanning, MR[, and a cardiac cathenzation laboratory, a variety of inpatient medical, surgical, and orthopedic services, including the only inpatient pain management program m northern Virginia, and comprehensive outpatient services, including outpatient surgery, physical medicine, and rehabilitation In addition, specialized obstetric and pediatric services are provided by the hospital's Maternal and Infant Health Center and a children's unit

o The Maternal and Infant Health Center at Fair Oaks includes a 24-bed obstetric unit and 19-bed nursery The Center provides obstetric delivery services, obstetric and gynecologic surgery, and infant care Neonatology coverage is provided 24-hours per day, and the Center has a Level 11 special care nursery for newborns with special medical needs

During 2002, Fair Oaks had 13,311 admissions and 43,932 patent days There were 3,978 newborn deliveries Emergency room visits were 33,687 for the year In addition, a total of 9,909 inpatient and outpatient surgery cases were performed

ACCESS of Fairf:ix, affiliated with Fair Oaks, and ACCESS of Reston and Springfield Healthplex, affiliated with Fairfax, are 24-hour, free standing emergency centers located m Fairfax City, Reston, and Springfield, Virginia, respectively During 2002, ACCESS of Favfax provided 18,074 emergency room visits and 9,290 outpatient visits, ACCESS of Reston reported 15,581 emergency room and 9,066 outpatient visits and Springfield Healthplex reported 47,469 emergency room visits

The Institute of Research and Education, a program of IHCS, was created in 1991 to expand opportunities for clinical research and education throughout Inova Health System The Institute, which is in close proximity to Fairfax, creates a quality arena for clinical research and professional education and reflects Inova's commitment to setting the pace for changes in medicine and technology The Insi Mute is the largest provider of Continuing Medical Education programs m the region

"Medically necessary care" refers to inpatient and outpatient services defined as medically necessary by the federal Medicare program "Medically indigent" is defined as those patients whose income falls at or below 250% of the Federal Poverty Guideline (FPG) In general, free medically necessary care is provided for patients with incomes falling below 125% of the FPG, and discounted care is provided for services rendered to patients with incomes falling between 125 and 250% of the FPG


COMMUNITY SERVICES

In keeping with the Community service mission of (nova, IHCS and its subsidiaries provide a wide range of programs and services which directly benefit the community they serve These programs and services include

o Providing the highest quality medical care to all members of the community, regardless of their financial resources

o Providing nonbilled and below margin health services to meet the identified needs of targeted community groups, such as the indigent and elderly, victims of cancer, heart disease, and stroke, persons affected by substance abuse, HIV-positive individuals, and others

o Providing health education and a variety of other services to the community

o Educating the medical community and participating in medical research activities

The many types of community services provided by IHCS and its subsidiaries are described more fully below In addition, the estimated unreimbursed cost of providmg these services are summarized m the attachment to ihis report

Charity Care

Charity care is defined as free or discounted healthcare services provided to persons who cannot afford to pay. Each II-ICS facility provides charity care m accordance with policies which ensure access to medically necessary care for all individuals These policies include the following key provisions

Emergency care shall be provided to all persons regardless of they ability to pay or place of residence

Non-emergency medically necessary care, except for certain specialty or referral programs, shall be provided by all hospitals and Access facilities to medically indigent patients

Following are descriptions of the various nonbilled and below margin patent services which are provided by IHCS and it subsidianes


In 2002, the unreiml>ursed cost of chanry care, including free and discounted services, was $29,646,487 This amount does not include the cost of care provided to the medically indigent through participation in governmental programs, which is described below

Participation in Governmental Programs for Those Without the Ability to Pay

Various government programs provide for the indigent, including Medicaid and Virginia State and Local Hospitalization (SLH) These programs provide some reimbursement for qualifying patients, however, payment is typically below the cost of those services In addition to federal and state programs, IHCS subsidiaries work with various County governments and agencies and provide certain free services to those residents the County identifies as most in need

Medicaid, established under Title XIX of the Social Security Act, provides assistance for the medically indigent, including those who cannot pay for care despite bung able to afford other living expenses Also covered are the blind, the disabled, and crippled children The reimbursement that [HCS facilities recei% e from the Medicaid program routinely falls below the actual cost of services provided During 2002, IHCS hospitals provided 43,911 days of care to Medicaid patients at an unreimbursed cost of $11,726,142 Fairfax provided 27,356 days of regular, newborn, and neonatal care to Medicaid patients, Mount Vernon provided 3,838 Medicaid days of regular and rehabilitation care, and Fair Oaks provided 2,171 Medicaid days, including regular and newborn care

II-ICS subsidianes also provide services to patients covered by the State and Local Hospitalization (SLH) program, which covers similar services as Medicaid, and which is also reimbursed below the cost of the services provided The cost of these services are included m the charity care amount

Nonbilled and Below Margin Patient Services

Each year, IHCS designates funds for the development and continuation of carefully identified programs and services that directly benefit, and provide access to, health care and related services to those most in need in the community Many of these programs and services are not billed to the patient or are provided for fees which are below the actual cost of providing the service During 2002, the unreimbursed cost of nonbilled and below margin patent services was $2,629,558, this amount excludes the cost of medical care provided to charity and medically indigent patients, wtuch is included m previously reported categories

o The International Diabetes Center of Virginia provides specialized services for diabetes management, with offices at Fairfax, Mount Vernon, and Fair Oaks hospitals The Center utilizes it staff of nurses, dieticians, and counselors to work with patients and their physicians on team management of diabetes Community services include diabetes education and support groups, supermarket tours, a weight management program, cooking classes, participation at local health fairs, and lectures to community organizations In addition, diabetes management services were provided to Obstetnc/Gynecology patents

INOVA HEALTH CARE SERVICES Page 7 2002 REPORT OF PROGRAM AND COMMUNITY SERVICES

o Fairfax's Obstetrics and Gynecology Clinic provides comprehensive obstetric and gynecologic services to women of limited income in Fairfax County Services include pregnancy prevention, pregnancy testing, prenatal care, and pennatal care for high-risk pregnancies The Clinic provided 33,199 patent visits m 2002

o The HIV Center, part of Faufax's Office of HIV Services, provides case management services to HIV-positive and AIDS patients of Northern Virginia An interdisciplinary approach utilizing RN case managers, hospital social workers, and representatives from community organizations is used to coordinate services required by HIV-infected patients

o Fairfax's Life with Cancer program provides a complete range of counseling, education, and support services to cancer patents and their families This program is open to all cancer patents in the area, regardless of where they are being treated for their illness A children's grief support ;soup, My Friend's House, is also part of the program

o Fairfax operates an Opthamology Clinic which provides optometry specialty services to the indigent including treatment of glaucoma, retina, and cataracts, children's specialty services are also provided The physicians volunteer their services or are paid nominal fees by the State of Virginia or by a sponsoring community organization

o The (nova Pediatric Center was established in 1993 to offer health care to children from low income families The Center is a collaborative effort between Inova Health System, several Favfax County agencies, and Faufax Hospital pediatricians and family practice physicians who donate their tune During 2002, the Clinic saw 13,408 children for two-week well-baby checks

o The Center for Facial Rehabilitation at Fairfax Hospital is a multi -discipli nary team of plastic and oral surgeons, speech pathologists, and other physicians who treat children and adults with cleft lip and palate and other craniofacial anomalies Most of the professionals volunteer their time, and Fairfax incurs unreimbursed costs for use of its facilities and for the parent information and support group which it sponsors

n Inova HeallhSource, Inova's community education department, was created in 1993 to provide comprehensive services for promoting the health status of the community HeaIthSource consolidated many of the existing community education classes and other activities off.-red by IHCS and it subsidiaries and now coordinates these In addition, (nova HeaIthSourc .- has created a Consumer Resource Library to better respond to the needs of the community by providing materials and services geared to those without medical training During 200?, 102,523 community residents participated in the education programs at HealthSource . These programs included the expectant parenting and women and children's programs, tours of Fairfax's new Women and Children's Center, and prenatal education for Obstetric/G:mecology Clinic patents Other classes provided nutrition and fitness education, and provided nutrition counseling to Medicare and Medicaid patents


o Members of the Department of Medicine staff and transitional residents provide free medical services and consulting to the Bailey's Health Center The center is part of the Fairfax County Affordable Health Care Network which provides medical care to uninsured and underinsured patients m the Baileys Crossroads area of Northern Virginia

o IHCS and its subsidiaries provide many other nonbilled and below margin patient services Case management services are provided to the indigent, and assistance is provided with financial paperwork Mount Vernon participates m the Health Information and Claims Assistance Program by providing assistance with health insurance paperwork problems In addition, home IV therapy services are provided for the indigent, and transportation is provided for indigent patents to and from IHCS facilities and programs Fairfax provides forensic and medical care to abused adults and chi ldem Fairfax also provides blood alcohol testing for area police departments and coordinates the disposition of deaths with various community oiganizations Other services include pastoral care, free living accommodations for out-of-loom Fairfax heart and lung transplant patients and then families, and emergency assistance to patients and their families needing medication or transportation

Community Health Education and Promotion

As part of [nova's overall health promotion effort, IHCS and its subsidiaries are actively involved in sponsoring programs, activities, and services designed to improve community health and prevent the onset of disease

IHCS and its subsidiaries produce and distribute a number of community health newsletters and other publications which include articles on specific health topics and provide information on health services and classes offered to the community Periodic newsletters include "Regarding Health ;" Bright Beginnings," and "Partners" These newsletters were mailed to ov~:r 500,000 community residents several times during 2002

o Fairfax provides laundry and linen services to the homeless In 2002, laundry and linen were provided to 3,500 homeless people m the area


In addition to Inova HeaIthSource, IHS hospitals provide a number of health classes and support groups to its patients, their family members, and community residents on a wide variety of health topics These topics include. diabetes education and treatment, nutrition, weight management, and exercise, heart health, lung disease, breast cancer, cardiac, physical, speech and respiratory therapy, smoking cessation, stress management, and many others In addition, the Institute of Research and Education's "Project CPR" was initiated m 1994 to ensure access to CPR training throughout the [nova community.

o IHCS subsidh<ines provide other community health education and promotion services Health information and healthcare screenings are provided for free or for nominal charges (for cholesterol testing, to cover the cost of supplies) at many IHCS facilities and at local health fags and other community events Tours of 1HCS facilities and programs are provided year-round for many community, school, and civic groups Health talks are provided on a variety of healthcare topics, and an executive speakers bureau is made available to community oiganizauons In addition, IHCS hospitals provide the community with access to its medical libraries and library services

Other Community ;ervices

IHCS and its subsidiaries go beyond their role as providers of health care services, community health education, and medical education and research, to provide other community services as well On an ongoing basis, IHCS contributes it facilities and resources to benefit the community it serves

Inova Medical Airfare is a unique 24-hour medical ly-eqwpped helicopter transport unit which generally operates within a 150 mile radius of Fairfax hospital, serving 1-ICS hospitals and other hospitals m the surrounding area The service is used primarily for transporting critical patients between hospitals to obtain more advanced medical treatment, patients transported include including critically ill infants, cardiac patents, and other patients who need specialized medical and surgical care Occasionally, the helicopter is called to provide patient transport from an accident scene to an appropriate hospital, supplementing Fairfax County's helicopter services

o The local Meals on Wheels program prepares and delivers meals to area residents who cannot prepare then own meals due to their medical condition Fairfax, Mount Vernon, and Fair Oaks hospitals prepare meals for the program, which are delivered by community volunteers During 2002, the hospitals prepared over 120,000 meals

As a teaching hospital, Fairfax incurs typical, additional costs associated with those of teaching facilities physician teaching cost and resident salaries, the cost of maintaining higher levels of technology required to support a teaching program, and the cost of extra tests ordered for teaching purposes During 2002, the total cost associated with these medical education programs was $19,995,472 Of this amount, Medicare and Medicaid reimbursed $12,876,736 for these programs, and the hospital incurred $7,118,736 m unreimbursed costs


At Fairfax, a staff of Fairfax County Department of Human Resources Eligibility workers is provided to assist patients m completing Medicaid/SLH applications. Hospital financial counselors pre-screen patents and refer them to DHS workers

lnova promotes employee volunteensm through its employee volunteer program, People-in-Action, which coordinates corporate-sponsored community service activities IHCS and it subsidiaries donate staff salaries, benefits, and other expenses for the administration and collection of funds and goods for sponsored community programs IHCS employees donate their time, personal funds, and other items to sponsored organizations During 2002, IHCS employees participated in the United Way, Adopt-a-Family Christmas Program, clothes and food drives, school partnerships, and a number of other community service programs

Other community services include use of space and services by community groups, contributions and in-kind donations and services, and other services The unreimbursed cost of meeting space includes prorated rental expense, where applicable, and the cost of setup, cleanup, and refreshments, m some cases Also, Fairfax provides system case management which transitions patients from hospital to community services and provides free local phone call for patients and families

Medical Community Education

Towards the goal of' improving patent care, IHCS subsidianes provide a variety of innovative medical education acid training programs for medical residents and students, physicians, and other health care professionals

o Fairfax's medical education programs offer a vanety of clinical training for medical residents, nursing students, and other medical students Fairfax's residency program has approximate4y 150 residents (medical student graduates) at any one time and an average of 350 students are framed each year Residents and students are primarily from Georgetown and George 'Washington Universities In addition, a graduate-level Nursing Demonstration Program is provided in conjunction with George Mason University, and paramedical education is provided by The School of Medical Technology, a fully-accredited program 1'or training lab iechnicians

File Name IHCSCSVC.02

[NOVA HEALTH ('ARE SERVICES Page 11 2002 REPORT OF PROGRAM AND COMMUNITY SERVICES

Fairfax also provides a center for clinical education and development This center had 7,500 participants al an unreimbursed cost of $2,616,200

The Institute of Research and Education provides quality educational opportunities for physicians and other health professionals which support and enhance the professional's ability to deliver quality patient care by helping them keep pace with medicine and technology developments Each year, through it Education and Conference Services division (ECS), the institute provides conference management services for more than 50 educational activities cov°nng all medical specialty areas Lectures and workshops planned by Inova physicians feature nationally and internationally recognized experts Gom within and outside [nova Health System In 2002, the unreimbursed cost of education activities conducted or sponsored by the institute was $546,814

The goal of the Northern Virginia HIV Resource and Consultation Center, part of the Office of HPJ Services at Fairfax, is to increase access to health care for HIV-posiuNe patients The Center addresses this goal by educating and training health care professionals to care for HIV-infected patients and by providing consultation and HIV resource materials

IHCS subsidianes participated m the following other medical education programs m 2002 Mount Vemcn provided clinical internships for 3 students m physical therapy, occupational therapy, and speech/language pathology Fair Oaks provided cynical training for 8 laboratory technician and phlebotomy students from Northern Virginia Community College In addition, Fair-fax participated m programs with 6 local universities to provide field experience to 8 lab students paramedical students

Medical Research

The Research Services division of IHCS's Institute of Research and Education provides a variety of essential services to support health-related scientific research Through the Institute, physicians and other Inova health professionals participate m clinical investigations that may lead to advances in medical treatrnem and patient care Investigators and sponsors are provided access to a range of facilities and cynical specialities one would expect m a university setting The Institute provides technical and administrative support m the design, conduct, and administration of clinical investigational studies, and m contract management During 2002, the Institute conducted 199 clinical teals at a urseimbursed cost of $3,645,246

451,892

546,814 7,118,736 2,616,200

3,645,246

875,533

60,719,682

IHCSCS02 XLS

INOVA HEALTH CARE SERVICES 2002 COMMUNITY SERVICE REPORTING COMMUNITY SERVICE SUMMARY

CHARITY AND INDIGENT CARE

PARTICIPATION IN GOVERNMENTAL PROGRAMS FOR THOSE WITHOUT THE ABILITY TO PAY

Unreimbursed Cost of Medicaid Patients

NONBILLED AND BELOW MARGIN PATIENT SERVICES

Diabetes Center Life vnth Cancer HIV Center Obstetrics and Gynecology Clinic Pediatric Center Pediatric Nephrology Child Life Fairfax County Deten4on Program Facial Rehabilitation Treatment Ophthalmic Specialty Services to the Indigent Sexual Assault Nurse Examiner Program

COMMUNITY HEALTH EDUCATION AND PROMOTION

Healthsource PievenUon Congregational Health Partnership for Healthier Kids

Nedicaid/Slh Eligibility Assistance

MEDICAL COMMUNITY EDUCATION

Institute for Research and Education Conferences Favfax Interns and Residents Program Center for Clinical Education and Development

MEDICAL RESEARCH

Institute of Research and Education

O7HER COMMUNITY BEN EFITS

TOTAL

29,646,487

71,726,142

355,645 6,418

508,208 874,000 162,530 98,001 34,000 174,504 122,532 242,999 50,901

403,000 279,522 216,786 563,586

" If you are filing for an Automatic 3-Month Extension, complete only Part I and check this box 1.0 " If you are filing for an Additional (not automatic) 3-Month Extension, complete only Part II (on page 2 of this form) Note : Do not complete Part 11 unless you have already been granted an automatic 3-month extension on a previously fled form 8868 Part I Automatic 3-Month Extension of Time-Only submit original (no copies needed) Note . Form 99aT corporations requesting an automatic 6-month extension - check this box and complete Part / only II All other corporations (including Form 990-C filers) must use Form 7004 to request an extension o/ time to ale income tax returns Partnerships, REMICs and hosts must use Form 8736 to request an extension of time to file Form 1065, 1066, or 1041

Name o1 Exempt Organization

INOVA HEALTH CARE SERVI Type or print

File by the due date for filing your return sea instructions

54-0620889

FLOOR TAX faun a post affi:e, state, and ZIP code For a forego address, see instructions ,LS CHURCH . VIRGINIA 22042

0 Form 990 [3 Form 990-T (corporation) E] Form 4720 Form 990-BL E] Form 990-T (sec 401(a)or408(a)trust) E] Form 5227 Form 99QEZ ~ Form 99dT (trust other than above) E] Form 6069

F-1 Form 990-PF ~ Form 1041-A E] Form 8870

ISA $iF FED905GF 1

Form 8868 ' Application for Extension of Time To File an (oecernber 2000) Exempt Organization Return OMB NO 151S770B DepNrnent of Me Treasury Internal R,,a�, 5�,�� " Fib a separate application for each return

Identification number

room or suite no It a P O box, see instructions

" If the organization does not have an office or place of business in the United States, check this box o. F~ " If this is for a Group Return, enter the organization's four digit Group Exemption Number (GEN) If this is for the whole group, check this fox jt~ [:] If it is for part of the group, check this box io. 0 and attach a list with the names and EINS of all members the extension will cover

1 I request an automatic 3-month (6-month, for 990-T corporation) extension of time until AUGUST 1 c; - .20 01 to file the exempt organization return for the organization named above The extension is for the organizations return for P [Xj calendar year 20 2L or

tax year beginning _ , 20 and ending -.20-

2 If this tax year is for less than 12 months, check reason Cj initial return D Final velum 0 Change in accounting period

3a If this application is for Form 990-BL, 990-PF, 990-T, 4720, or 6069, enter the tentative tax, less any nonrefundable credits See instructions j

b If this application is for Form 990-PF or 990-T, enter any refundable credits and estimated tax payments made Include any prior year overpayment allowed as a credit f

c Balance Due. Subtract line 3b from line 3a Include your payment with this form, or, if required . deposit with FTD coupon or, if required, by using EFTPS (Electronic Federal Tax Payment System) See instructions E

Signature and Verification Under penalties of penury I declare that 1 have examined this farm including accompanying schedules and statements and m the best of my knimledge and belief it is true correct and complete aid that i am authorized to prepare this form

Signawre go K/~ -L0~ riue " TAX MANAGER Date iii, 05/06/03 For Paperwork ReducLon Act NoUc e, see Instruction Form 8868 (iz zoao)

,, EXTENSInrunp~qOVE Director Date

Alternate Mailing Address - Enter the address if you want the copy of this application for an additional 3-month extqfte " returned to an address different than the one entered above 22003

FIELD UiRECiOt DWG, OLDEN

Type or I Number and street (include suite, room, or apt no pool

City or town, prop Inca or state, and or

Form 8868 (12 2000) STF FLD9056F 2

Form 8888 (1 .1,2000) ' Page 2 0 If you are filing for an Additional (not automatic) 3-Month Extension, complete only Part II and check this box 0. 7X Note : Only complete Part 11 d you have already been granted an automaGC 3-month extension on a previously bled Form 8868. o If you are filing for an Automatic 3-Month Extension, complete only Part I (on page 1) Part II Additional not automatic 3-Month Extension of Time - Must Fde Original and One Co Type or Name of Exempt Organization Employer Identification number print INOVA HEAL"H CARE SERVICES 54-0620889 File by the Number, street, and roan or suite no II a P O box, see instructions For IRS use only extended duedate rar 2990 TELES'CAR COURT, FOURTH FLOOR TAX rung the Cory, town or post office, state, and ZIP code For a forego address, see instructions velum Sea instruction, FALLS CHURCH, VIRGINIA 22042 Check type of return to be fled (File a separate application for each return) OX Form 990 0 Form 990 EZ 0 Form 990-T (sec 401(a) or 408(a) bust) [] Form 1041-A ~ Farm 5227 [:] Form 8870 0 Form 990-BL E] Form 990 PF ~ Form 990-T (trust other than above) 0 Form 4720 0 Form 6069

STOP, Do not complete Part II i f you were not already granted an automatic 9-month extension on a previously filed Form 8868

0 If the organization does not have an office or place of business in the United States, check this box 0. F~ * If this is far a Group Return, enter the organization's (our digit Group Exemption Number (GEN) If this is for the whole group, check this box Ili. EJ If it is for part of the group, check this box 1i R and attach a list with the names and EINs of all members the extension is for

4 I request an additional 3-month extension of time until NOVEMBER 7 20 03 5 For calendar year 2 0 0 2 , or other tax year beginning , 20 - and ending , 20-6 If this tax year is for less than 12 months, check reason ~ Initial return 0 Final return 0 Change in accounting period 7 State mdetail whyyouneeiitheextension TAXPAYER NEEDS ADDITIONAL TIME TO COMPILE THE

INFORMATION NE(:ESSARY TO FILE A COMPLETE AND ACCURATE RETURN .

8a If this application is for Form 990-BL, 990-PF, 990-T, 4720, or 6069, enter the tentative tax, less any nonrefundable credits See instructions $

b If this application is for Form 99dPF, 990-T, 4720, or 6069, enter any refundable credits and estimated !ax payments made Include any prior year overpayment allowed as a credit and any amount paid previously with Form 8868 $

c Balance Due. Subtract line 8b from line 8a include your payment with this form, or, if required, deposit with FTD coupon or, if required, by using EFTPS (Electronic Federal Tax Payment System) See instructions

Signature and Verification Under penalties of penury I declare that i have examined this form including accompanying schedules and statements and to the best of my knowledge and belief it is true correct and complete and that i am auNCrized to prepare this form

Signature I~ T'12w~ ", VI1 Title ~ TAX MANAGER Dace ~?~ !~ Notice to Applicant-To Be Completed by the IRS Vh We have approved this applicai ion Please attach this form to the organizations return 0 ~Ne have not approved this application However we have granted a t0-day grace period from the later of the date shown below or the due date of the

organization's return (including any prior extensions) This grace period is considered to be a valid extension of time for elections otherwise required to be made on a timely return Please attach this form to the organization's return we have not approved this application After considering the reasons stated in item 7, we cannot grant your request for an extension of lime to file We are not granting a 10-day grace period We cannot consider this application because it was fled after the due date of the return for which an extension was requested Other _

form 990 return of organization exempt from income...

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