JFK Financial Statements Dec 31, 2011 and 2010

JFK Health System, Inc. (formerly Solaris Health System, Inc.
) and Controlled Entities

Consolidated Financial Statements and Supplementary Information December 31, 2011 and 2010
JFK Health System, Inc. and Controlled Entities

Table of Contents December 31, 2011 and 2010
Page Independent Auditors Report Consolidated Financial Statements Balance Sheet Statement of Operations Statement of Changes in Net Deficit Statement of Cash Flows Notes to Consolidated Financial Statements Supplementary Information Independent Auditors Report on Supplementary Information Consolidating Schedules for 2011 Consolidating Schedule, Balance Sheet Consolidating Schedule, Statement of Operations Consolidating Schedule, Changes in Net (Deficit) Assets Consolidating Schedules for 2010 Consolidating Schedule, Balance Sheet Consolidating Schedule, Statement of Operations Consolidating Schedule, Changes in Net (Deficit) Assets 46 48 49 42 44 45 41 2 3 4 5 6 1
Independent Auditors Report

Board of Directors JFK Health System, Inc. and Controlled Entities We have audited the accompanying consolidated balance sheet of the JFK Health System, Inc. and controlled entities (collectively, the JFK Health System)(formerly the Solaris Health System, Inc.) as of December 31, 2011 and 2010, and the related consolidated statements of operations, changes in net deficit, and cash flows for the years then ended. These financial statements are the responsibility of the JFK Health Systems management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the JFK Health System, Inc. and controlled entities as of December 31, 2011 and 2010, and the results of their operations, changes in net deficit, and cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. As disclosed in Note 2 to the consolidated financial statements, the JFK Health System adopted the update to authoritative guidance pertaining to the presentation of insurance claims and related insurance recoveries.
Clark, New Jersey May 1, 2012

Consolidated Balance Sheet December 31, 2011 and 2010
2011 2010 2011 2010
Assets Current Assets Cash and cash equivalents Funds held for residents Investments Assets whose use is limited Accounts receivable, patients (net of estimated allowance for doubtful collections of $13,639,000 in 2011 and $15,219,000 in 2010) Inventories of drugs and supplies Prepaid expenses and other current assets Total current assets Investments Assets Whose Use is Limited Property and Equipment, Net Property and Equipment Held For Sale, Net Deferred Financing Costs, Net Pledges Receivable, Net Other Assets Beneficial Interest in Perpetual Trusts Current Liabilities Current maturities of long-term debt Current maturities of capital lease obligations Funds held for residents Accounts payable Accrued expenses Estimated third-party payor settlements Accrued postretirement benefits Other current liabilities Total current liabilities Long-Term Debt Capital Lease Obligations Estimated Third-party Payor Settlements Self-Insurance Reserves
4,267,506 722,935 5,509,720 4,327,504
52,989,638 225,236 19,335,590 2,203,372
40,741,409 236,175 18,756,219 2,214,214
966,656 1,673,125 225,236 30,127,035 31,863,852 10,301,653 718,861 2,516,798 78,393,216 171,292,194 4,862,723
1,115,415
60,914,121 6,305,765 8,050,233 150,023,955 1,991,092 54,023,047 155,371,337
64,493,204 6,324,349 8,965,898 141,731,468 2,559,178 50,714,780 155,149,059 3,930,481
1,153,507 236,175 32,350,270 32,361,623 5,315,291 881,649 2,113,622

75,527,552 171,957,285
4,131,589
17,284,313 24,147,699 82,348,263 1,164,328 7,604,959 387,097,695
15,828,841 21,718,056 84,627,015 13,258,999 1,020,868 388,070,205
4,623,086 Accrued Pension Cost 231,146 Accrued Postretirement Benefits 2,466,701 Other Liabilities 4,452,935 Total liabilities Net (Deficit) Assets Unrestricted Temporarily restricted Permanently restricted Total net deficit
(31,647,641) 13,357,658 7,429,384 (10,860,599) $ 376,237,096
(42,020,642) 12,266,016 7,543,255 (22,211,371) $ 365,858,834
Total
$ 376,237,096
365,858,834
Total
See notes to consolidated financial statements

Consolidated Statement of Operations Years Ended December 31, 2011 and 2010
2011 2010
Unrestricted Revenues, Gains, and Other Support: Net patient service revenues Other revenues Resident fees Special events Net assets released from restrictions used in operations Contributions Total unrestricted revenues, gains, and other support Expenses Salaries and wages Employee benefits Supplies and expenses Special events - unrestricted Provision for doubtful collections Depreciation and amortization Interest Total expenses Operating Income Loss on Sale of Property Pension Settlement and Curtailment Changes Investment Income Change in Net Unrealized Gains and Losses on Trading Securities Gain on Sale of Home Health Program Other Loss Revenues in Excess of Expenses Pension/Postretirement Liability Adjustment Distributions Net Assets Released from Restrictions for Capital Purchases Decrease (Increase) in Unrestricted Net Deficit from Continuing Operations Loss from Discontinued Operations Decrease (Increase) in Unrestricted Net Deficit
$ 482,704,155 18,910,316 6,835,570 209,715 554,907 370,127 509,584,790
$ 471,124,849 21,735,244 6,770,008 230,750 769,784 400,214 501,030,849
224,213,477 46,306,468 174,559,077 101,507 33,727,291 16,347,681 8,992,471 504,247,972 5,336,818 (30,909) 2,692,503 1,577,000 1,052,441 (34,625) 10,593,228 (95,519) (231,555) 394,065 10,660,219 (287,218) $ 10,373,001
234,114,060 49,074,259 163,327,968 115,742 29,606,824 15,528,424 8,813,804 500,581,081 449,768 1,561,570 631,416 4,619,185 (99,855) 7,162,084 (19,399,312) 262,188 (11,975,040) (586,817) $ (12,561,857)

Consolidated Statement of Changes in Net Deficit Years Ended December 31, 2011 and 2010
2011 2010
Unrestricted Net Deficit Revenues in excess of expenses Pension/postretirement liability adjustment Distributions Net assets released from restrictions for capital purchases Decrease (increase) in unrestricted net deficit from continuing operations Loss from discontinued operations Decrease (increase) in unrestricted net deficit Temporarily Restricted Net Assets Contributions Investment income Net realized and unrealized (losses) gains on investments Change in provision for doubtful accounts Net assets released from restrictions used in operations Net assets released from restrictions for capital purchases Increase in temporarily restricted net assets Permanently Restricted Net Assets Contributions Change in valuation of beneficial interest in perpetual trusts (Decrease) increase in permanently restricted net assets Decrease (Increase) in Net Deficit Net Deficit Beginning of year End of year
10,593,228 (95,519) (231,555) 394,065
7,162,084 (19,399,312) 262,188
10,660,219 (287,218) 10,373,001
(11,975,040) (586,817) (12,561,857)
2,064,690 176,007 (104,636) (95,447) (554,907) (394,065) 1,091,642
1,146,048 237,795 214,922 10,829 (769,784) (262,188) 577,622
11,560 (125,431)
11,050 272,806
(113,871) 11,350,772
283,856 (11,700,379)
(22,211,371) $ (10,860,599)
(10,510,992) $ (22,211,371)

Consolidated Statement of Cash Flows Years Ended December 31, 2011 and 2010
2011 2010
Cash Flows from Operating Activities Decrease (increase) in net deficit Adjustments to reconcile decrease (increase) in net deficit to net cash provided by operating activities: Depreciation Amortization Provision for doubtful collections Loss on sale of equipment Gain on sale of Home Health Program Loss on impairment Net realized and unrealized gains on investments Change in valuation of beneficial interest in perpetual trusts Pension/postretirement liability adjustment Postretirement settlement and curtailment changes Temporarily restricted contributions and investment income Changes in assets and liabilities: Accounts receivable, patients Inventories of drugs and supplies Prepaid expenses and other assets Accounts payable Accrued expenses Estimated third-party payor settlements Accrued pension cost Self-insurance reserves Accrued postretirement benefits Other liabilities Net cash provided by operating activities Cash Flows from Investing Activities Increase in investments and assets whose use is limited Net proceeds from sale of Home Health Program and equipment Net proceeds from sale of Midtown Shops Purchases of property and equipment Net cash used in investing activities Cash Flows from Financing Activities (Increase) decrease in pledges receivable Proceeds from restricted contributions and investment income Repayment of long-term debt Repayment of capital lease obligations Proceeds from issuance of other long-term debt Payment of financing costs Net cash provided by (used in) financing activities Increase in Cash and Cash Equivalents Cash and Cash Equivalents, Beginning Cash and Cash Equivalents, Ending Supplemental Disclosure of Cash Flow Information, Interest paid Purchases of property and equipment through capital lease obligations
$ 11,350,772
$ (11,700,379)
15,970,363 377,318 33,727,291 30,909 607,570 (1,126,983) 125,431 95,519 (2,692,503) (2,240,697) (30,148,208) 18,584 (2,127,354) (2,223,235) (497,771) 6,441,834 (2,374,271) 2,429,643 (9,564,956) 3,987,267 22,166,523
15,150,688 377,736 29,606,824 36,274 (4,619,185) 1,040,873 (914,550) (272,806) 19,399,312 (1,383,843) (30,999,860) 876,015 (1,554,316) 2,901,833 1,974,107 961,383 (7,089,984) (3,636,937) 1,413,534 (970,766) 10,595,953
(2,181,727) 3,896,882 (13,955,461) (12,240,306)
(1,244,056) 4,657,565 (8,992,481) (5,578,972)
(491,789) 2,240,697 (813,850) (1,591,308) 3,000,000 (21,738) 2,322,012 12,248,229 40,741,409 $ 52,989,638
43,281 1,383,843 (643,494) (900,217) (116,587) 4,900,394 35,841,015 $ 40,741,409
$ $
9,015,552 2,842,060
$ $
8,816,018 6,185,313
See notes to consolidated financial statements 5

Notes to Consolidated Financial Statements December 31, 2011 and 2010
1. Organizational Structure and Nature of Operations During 2011, the Solaris Health System, Inc. legally changed its name to JFK Health System, Inc. (the JFK Health System). The JFK Health System is the parent company of the Community Hospital Group, Inc. d/b/a JFK Medical Center (JFK Medical Center); Muhlenberg Regional Medical Center, Inc. (MRMC); John F. Kennedy Medical Center Foundation, Inc. (JFK Foundation); Muhlenberg Foundation, Inc. (Muhlenberg Foundation); LIFEstyle Institute, Inc. (LIFEstyle); JFK Healthshare, Inc. (Healthshare); Hartwyck at JFK, Inc.; Hartwyck West Nursing Home, Inc. and affiliates (Hartwyck West); Hartwyck at Oak Tree, Inc. (Oak Tree); and Atlantic Insurance Exchange, Ltd. (AIE), a wholly-owned insurance company. Hartwyck West operates Hartwyck at Cedar Brook (Cedar Brook), JFK Assisted Living, Inc. d/b/a Whispering Knoll (Whispering Knoll), and JFK Hartwyck Management and Consulting, Inc. (Consulting). Healthshare is the general partner in Mediplex Surgical Center Associates, Limited Partnership (Mediplex). On February 21, 2008, the JFK Health System Board of Directors voted to immediately authorize the filing of a certificate of need (CON) application to close MRMC. The CON application was approved on July 29, 2008 and MRMC was closed on August 13, 2008. The JFK Health System will provide the opportunity for MRMC to continue its remaining operations. The consolidated financial statements do not include any adjustments that might be necessary if MRMC is unable to continue as a going concern. On December 31, 2010 MRMC formed a joint venture with Meridian Healthcare to establish the new organization, JFK Meridian Home Care Services, LLC d/b/a JFK at Home (JFK at Home). JFK at Home is a home health care provider. The operations of Muhlenbergs Home Care department ceased as of that date. In connection with the formation of JFK at Home, MRMC transferred property and equipment to JFK at Home at its carrying value of approximately $258,000 for 50% ownership and $5,000,000. A gain on sale of the Home Care business of $4,619,185, net of closing costs, was recorded in the consolidated statement of operations as of December 31, 2010. The investment in JFK at Home is accounted for on the equity method of accounting and included in other assets on the consolidated balance sheet. During 2011 $97,953 was recorded as gain on investment in the joint venture and is included in other revenues in the consolidated statement of operations During 2007, the Muhlenberg Foundation, Inc. (the Foundation) transferred to MRMC a pledge which included the Midtown Shops property (the property). Once MRMC closed on the property, Midtown Shops became a wholly-owned MRMC subsidiary. On June 30, 2011, the property was sold at its carrying value of approximately $3,928,000 for $4,010,000, and a loss on sale of $30,909, net of closing costs, was recorded in the consolidated statement of operations as of December 31, 2011. The JFK Health System owned 49.5% equity in the Tri-County Heart New Jersey, LLC Joint Venture and was accounted for under the equity method of accounting. As of June 1, 2010, The JFK Health System increased its ownership percentage to approximately 75% and has consolidated the joint ventures financial statements from June 1, 2010 through December 31, 2010 and entire year for 2011 in the accompanying consolidated financial statements. Noncontrolling interest for approximately 25% included in unrestricted net assets were $522,251 and $425,962 as of December 31, 2011 and 2010, respectively. Distributions of $231,555 were made to non-controlling shareholders during 2011. 6

During 2011, the JFK Medical Center entered into a joint venture to provide management services with Edison Imaging Associates, P.A. to create Edison Imaging at JFK Medical Center, LLC which is accounted for under the equity method of accounting. Equity balance at December 31, 2011 was $900,838 and included in other long-term assets. During 2011, distributions received from the joint venture were $1,500,000 and increase in joint venture of $2,400,838 was recorded in other revenue in the statement of operations for 2011. The JFK Health System and its controlled entities provide health care services ranging from acute care hospital services to rehabilitation, skilled nursing, sub-acute, and long-term care services in New Jersey and the New York metropolitan area, in addition to other activities for the benefit and support of the JFK Health System. Subsequent Events The System evaluated subsequent events for recognition or disclosure through May 1, 2012, the date the consolidated financial statements were issued.
2. Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the accounts of the JFK Health System, JFK Medical Center, MRMC, JFK Foundation, Muhlenberg Foundation, LIFEstyle, Healthshare, Hartwyck at JFK, Inc., Hartwyck West, Oak Tree, and AIE. All significant intercompany balances and transactions have been eliminated. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents include certain investments in highly liquid debt investments purchased with an original maturity of three months or less, excluding assets whose use is limited. Accounts Receivable, Patients Accounts receivable, patients are reported at net realizable value. Accounts are written off when they are determined to be uncollectible based upon managements assessment of individual accounts. The allowance for doubtful collections is estimated based upon a periodic review of the accounts receivable aging, payor classifications, and application of historical write-off percentages. 7

Inventories of Drugs and Supplies Inventories of drugs, medical and surgical supplies, and maintenance supplies are stated at the lower of cost or market. Cost is determined on a first-in, first-out basis. Investments and Investment Risk Investments in equity securities with readily determinable fair values and all investments in debt and equity securities and mutual funds are measured at fair value in the consolidated balance sheet. Cash and cash equivalents are carried at cost which approximates fair value. Investment income or loss (including realized and unrealized gains and losses on trading securities, interest, dividends, and capital gains distributions) is included in the determination of revenues in excess of expenses unless the income or loss is restricted by donor or law. Unrealized gains and losses on investments are excluded from determination of revenues in excess of expenses unless the investments are trading securities. Donor restricted investment income is reported as an increase in temporarily restricted net assets. The JFK Health System's investments are comprised of a variety of financial instruments and are managed by investment advisors. The fair values reported in the consolidated balance sheet are subject to various risks including changes in the equity markets, the interest rate environment, and general economic conditions. Due to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the fair value of investment securities, it is reasonably possible that the amounts reported in the consolidated balance sheet could change materially in the near term. Assets Whose Use is Limited Assets whose use is limited include assets held by bond trustees under trust indentures; assets set aside under deferred compensation plans; assets set aside as required for selfinsurance programs; and assets restricted by donors. Amounts available to meet current liabilities have been reclassified as current assets in the accompanying consolidated balance sheet. Assets whose use is limited consists of cash and cash equivalents, certificates of deposit, U.S. government obligations, U.S. government mortgaged-back obligations, mutual funds, corporate bonds, and marketable equity securities and are carried at fair value. Property and Equipment Property and equipment acquisitions are recorded at cost. Donated property and equipment are recorded at fair market value at the date of receipt. Depreciation is computed using the straight-line method based on estimated useful lives. Gifts of long-lived assets such as land, buildings, or equipment are reported as unrestricted support unless explicit donor stipulations specify how the donated assets must be used. Gifts of long-lived assets with explicit restrictions that specify how the assets are to be used and gifts of cash or other assets that must be used to acquire long-lived assets are reported as restricted support. Absent explicit donor stipulations about how long those long-lived assets must be maintained, expirations of donor restrictions are reported when the donated or acquired long-lived assets are placed in service.

Impairment of Long-Lived Assets The JFK Health System reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to future net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount of fair value, less costs to sell. Beneficial Interest in Perpetual Trusts MRMC and Muhlenberg Foundation have received as contributions various split-interest agreements, including perpetual trusts. Under the perpetual trust agreements, MRMC and Muhlenberg Foundation have recorded the asset and have recognized permanently restricted contribution revenue at the fair market value of their beneficial interest in the trust assets. Income earned on the trust assets is recorded as investment income in the accompanying consolidated statement of operations, unless otherwise restricted by the donor. Subsequent changes in fair values are recorded as a change in valuation of beneficial interest in perpetual trusts in permanently restricted net assets. Pursuant to the terms of the instruments creating such perpetual trusts, MRMC and Muhlenberg Foundation have no legal right to direct the application of the assets and even though these assets are shown on the accompanying consolidated balance sheet, they are subject to the jurisdiction of the court. With the closure of MRMCs hospital, the perpetual trusts are all being reviewed; however the possible future financial effects, if any, are not presently determinable. Deferred Financing Costs Financing costs incurred in connection with the issuance of long-term debt have been deferred and are being amortized over the term of the debt using the effective interest method. Amortization amounted to $377,318 in 2011 and $377,736 in 2010. Accumulated amortization of deferred financing costs at December 31, 2011 and 2010 totaled $986,023 and $608,705, respectively. Pledges Receivable Pledges receivable are primarily unsecured and are receivable from individuals and businesses located in central New Jersey. Pledges receivable and revenue are recorded at fair value, which was estimated as the present value of estimated cash flows on the date the unconditional promise to give is made. Revenues in Excess of Expenses The consolidated statement of operations includes the determination of revenues in excess of expenses. Changes in unrestricted net assets which are excluded from the determination of revenues in excess of expenses, consistent with industry practice, include unrealized gains and losses on investments other than trading securities, pension liability adjustment, 9

permanent transfers of assets to and from subsidiaries for other than goods and services, loss from discontinued operations, and contributions of long-lived assets (including assets acquired using contributions which by donor restriction were to be used for the purposes of acquiring such assets). Net Patient Service Revenues The JFK Health System has agreements with third-party payors that provide for payments at amounts different from its established rates. Payment arrangements include prospectively determined rates per discharge, reimbursed costs, discounted charges, and per diem payments. Net patient service revenues are reported at the estimated net realizable amounts from patients, third-party payors, and others for services rendered, including estimated retroactive adjustments under reimbursement agreements with third-party payors. Retroactive adjustments are accrued on an estimated basis in the period the related services are rendered and adjusted in future periods as tentative and final settlements are determined. It is reasonably possible that the estimates used could change in the near term. Charity Care The JFK Health System provides care to patients who meet certain criteria without charge or at amounts less than its established rates. Because the JFK Health System does not pursue collection of amounts determined to qualify as charity care, such amounts are not reported as revenues. Advertising Costs Advertising costs are expensed as incurred. Such costs amounted to approximately $1,584,000 and $1,079,000 in 2011 and 2010, respectively. Donor-Restricted Gifts Unconditional promises to give cash and other assets are reported at fair value at the date the promise is received. Conditional promises to give and indications of intentions to give are reported at fair value at the date the gift is received. The gifts are reported as either temporarily or permanently restricted support if they are received with donor stipulations that limit the use of the donated assets. When a donor restriction expires, that is, when a stipulated time restriction ends or purpose restriction is accomplished, temporarily restricted net assets are reclassified as unrestricted net assets and reported in the consolidated statement of operations as net assets released from restrictions. Donor restricted contributions whose restrictions are met within the same year as received are reflected as unrestricted contributions in the accompanying consolidated financial statements. Income Taxes The JFK Health System, JFK Medical Center, MRMC, JFK Foundation, Muhlenberg Foundation, LIFEstyle, Hartwyck at JFK, Hartwyck West Nursing Home, Inc., Whispering Knoll, and Oak Tree are not-for-profit corporations as described in Section 501(c)(3) of the Internal Revenue Code and are exempt from federal income taxes on their exempt income under Section 501(a) of the Internal Revenue Code. 10

Consulting, Healthshare, AIE, Midtown Shops, and Mediplex are organizations subject to federal and state income taxes. The JFK Health System accounts for uncertainty in income taxes by prescribing a recognition threshold of more-likely-than-not to be sustained upon examination by the appropriate taxing authority. Measurement of the tax uncertainty occurs if the recognition threshold has been met. There were no tax uncertainties that met the recognition threshold in 2011 or 2010. The JFK Health Systems policy is to recognize interest related to unrecognized tax benefits in interest expense and penalties in operating expenses. The JFK Health Systems federal Tax Exempt Organization Business Income Tax Returns for years ended December 31, 2010, 2009, and 2008 remain subject to examination by the IRS. Estimated Malpractice Costs The provision for estimated medical malpractice claims includes estimates of the ultimate costs for both reported claims and claims incurred but not reported, including costs associated with litigating or settling claims. Anticipated insurance recoveries associated with reported claims are reported separately in JFK Health Systems consolidated balance sheet at net realizable value. Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents and demand note payable approximate fair value at December 31, 2011 and 2010. Investments and assets whose use is limited are stated at fair value, which are the amounts reported in the consolidated balance sheet, based on quoted market prices, if available, or estimated using quoted market prices of similar securities. Beneficial interest in perpetual trusts is valued using discounted cash flow methodologies. The fair value of long-term debt is calculated based on quoted market prices, if available, or estimated using quoted market prices of similar securities.
2011 Carrying Amount Fair Value $ 52,989,638 21,326,682 56,226,419 4,327,504 186,054,449 $ Carrying Amount 40,741,409 21,315,397 52,928,994 4,452,935 173,072,700 $ 2010 Fair Value 40,741,409 21,315,397 52,928,994 4,452,935 180,448,320
Cash and cash equivalents Investments Assets limited as to use Beneficial interest in perpetual trusts Long-term debt
52,989,638 21,326,682 56,226,419 4,327,504 172,258,850
11

Postretirement Benefits The JFK Health System accounts for postretirement benefits on an accrual basis. Postretirement benefits include reimbursement to qualified retirees for a portion of their health and life insurance costs. Temporarily and Permanently Restricted Net Assets Temporarily restricted net assets are those whose use by the JFK Health System have been limited by donors to a specific time period or purpose. Permanently restricted net assets have been restricted by donors to be maintained by the JFK Health System in perpetuity. Reclassification Certain 2010 amounts have been reclassed to conform to the 2011 presentation. New Accounting Pronouncements Charity Care In August 2010, the Financial Accounting Standards Board (FASB) issued amended disclosure guidance relating to the measurement of charity care provided. The guidance requires that direct and indirect costs be used as the basis of measurement for charity care disclosure purposes. The guidance also requires disclosure of the method used to identify or determine such costs. The adoption of the amended guidance revised the disclosure in the notes to the JFK Health Systems consolidated financial statements but did not impact amounts reported in the primary consolidated financial statements. Insurance Claims In August 2010, the FASB issued Accounting Standards Update 2010-24, Presentation of Insurance Claims and Related Insurance Recoveries which amended guidance relating to the presentation of insurance claims and related insurance recoveries. The guidance clarifies that health care entities may not net insurance recoveries against a related claim liability. In addition, the amount of the claim liability should be determined without consideration of insurance recoveries, if any, should be measured and presented separately within the consolidated balance sheet. The adoption of the amended guidance resulted in a reduction of $470,000 to net assets as of January 1, 2011.
12

Provision for Doubtful Collections The JFK Health System will be required to adopt amended guidance related to heath care entities which requires a change in reporting the provision for bad debts associated with net service revenues. As a result of this guidance, the provision, which is currently reported as an operating expense in the JFK Health Systems consolidated statement of operations, will be reported as a deduction from service revenues, net of contractual allowances and discounts. The guidance also enhances required disclosures regarding the policies for recognizing net service revenues and assessing bad debts. In addition, the guidance requires disclosure of net service revenues and qualitative and quantitative information about changes in the allowance for doubtful accounts, both my major payor sources. The amended guidance is effective for the fiscal years ending after December 15, 2012. Adoption of the amended guidance will require retrospective restatement of the statement of operations and prospective financial statement disclosures. 3. Charity Care The JFK Health System provides care to patients who meet the strict charity care criteria of the New Jersey State Department of Health (the Department) without charge or at amounts less than its established rates. Because the JFK Health System does not pursue collection of amounts determined to qualify as charity care, they are not reported as patient service revenue. In accordance with guidelines established by the Department, the JFK Health System maintains records to identify and monitor the level of charity care it provides. The estimated costs of providing charity care are based upon the direct and indirect costs identified with the specific charity care services provided. The level of charity care provided by the JFK Health System amounted to approximately $27,063,000 in 2011 and $22,548,000 in 2010. 4. Net Patient Service Revenues The JFK Health System has agreements with third-party payors that provide for payments to the JFK Health System at amounts different from its established rates. A significant portion of the JFK Health Systems net patient service revenues are derived from these third-party payor programs. A summary of the principal payment arrangements with major third-party payors is as follows: Medicare: Inpatient acute care and rehabilitation services and outpatient services rendered to Medicare program beneficiaries are paid at prospectively determined rates. These rates vary according to patient classification systems that are based on clinical, diagnostic, and other factors. Skilled nursing services provided to Medicare Part A beneficiaries are paid at prospectively determined rates per day and services to Medicare Part B beneficiaries at the lesser of a published fee schedule or actual charges, subject to an annual limitation. Defined medical education costs related to Medicare beneficiaries are paid based on a cost reimbursement methodology subject to various limitations. Reimbursements for cost reimbursable items are received at tentative interim rates, with final settlement determined after submission of annual cost reports by the JFK Health System and audits thereof by the Medicare fiscal intermediary. The JFK Health Systems Medicare cost reports have been settled by the Medicare fiscal intermediary through December 31, 2004. 13

In July 2011, the Department of Health & Human Services, Centers for Medicare & Medicaid Services issued the final rule reducing Medicare Part A payments to skilled nursing facilities for the period October 1, 2011 through September 30, 2012 by 11.1%, as compared to payments for the period October 1, 2010 through September 30, 2011. Medicaid: Inpatient acute care and skilled nursing services rendered to Medicaid program beneficiaries are paid at prospectively determined rates per discharge. These rates vary according to a patient classification system that is based on clinical, diagnostic, and other factors. Inpatient nonacute services are paid at prospectively determined per diem rates. Outpatient services are paid based on a published fee schedule with final settlement determined after submission of annual cost reports. The Medicaid cost reports have been settled through December 31, 2008. Through June 30, 2010, the rates were based on facility cost information from a prior year and were subject to various limitations and adjustments. Effective July 1, 2010, the rates are determined using state-wide nursing facility cost information and the Hartwyck West cost information from a prior year. The rates also vary according to a resident classification system that is based on clinical, diagnostic, and other factors. The reimbursement methodology is subject to various limitations and adjustments. The new reimbursement methodology effective July 1, 2010 was finalized by the New Jersey Department of Health and Senior Services (NJDHSS) during 2011. As a result, during 2010, Hartwyck West and Oak Tree were reimbursed and recorded revenue for the period July 1, 2010 through December 31, 2010 using the July 1, 2009 Medicaid rate. Net resident service revenues for 2011 include the effects of negative rate adjustments for the period July 1, 2010 through December 31, 2010 of approximately $53,880 for Hartwyck West and a positive rate adjustment through December 31, 2010 for Oak Tree of approximately $124,000. As a result of a negative rate adjustment implemented by NJDHSS effective July 1, 2011, a significant number of nursing facilities in New Jersey experienced a decrease in their Medicaid rate. Hartwyck West and Oak Tree experienced approximately a 9% decrease in its Medicaid rate effective July 1, 2011. This decrease is expected to remain through June 30, 2012, at which point the Medicaid rate will be reset. Revenue received under third-party arrangements is subject to audit and retroactive adjustments. Net patient service revenues include favorable adjustments of approximately $1,623,754 and $1,280,000 in 2011 and 2010, respectively. The adjustments related to tentative and final settlements of prior year cost reports and other settlements. The JFK Health System has also entered into payment agreements with certain commercial insurance carriers, health maintenance organizations, and preferred provider organizations. The basis for payment to the JFK Health System under these agreements includes prospectively determined rates per discharge, discounts from established charges, prospectively determined daily rates, and various other prospectively determined rates.
14

New Jersey Nursing Home Assessment The New Jersey Nursing Home Assessment Plan (the Plan) requires the JFK Health System to pay a quarterly assessment on its nursing facility days, excluding Medicare Part A days, and the New Jersey Department of Health and Senior Services provides additional reimbursement to the JFK Health System. The financial effects of the Plan have been recorded in the accompanying consolidated financial statements, as follows:
2011 2010 $ 1,948,377 1,609,975 338,402
Revenue Expense Revenue (less than) in excess of expense
937,904 1,570,532 (632,628)
Plan revenue is classified as a component of net patient service revenues and Plan expense is classified as a component of supplies and expenses in the accompanying consolidated statement of operations. In addition, Oak Tree and Cedar Brook recorded a liability of $387,186 and $405,685 at December 31, 2011 and 2010, respectively, related to the fourth quarter assessment. The amount is included in accrued expenses in the accompanying consolidated balance sheet. 5. Investments and Assets Whose Use is Limited The composition of investments and assets whose use is limited at December 31, 2011 and 2010 is set forth in the following table:
2011 2010 $ 13,343,727 740,369 1,833,220 1,313,894 1,696,188 595,436 676,640 1,115,923 21,315,397 18,756,219 $ 2,559,178
Investments: Cash and cash equivalents Certificates of deposit U.S. government obligations U.S. agency obligations Mutual funds equities Mutual funds - fixed income Corporate bonds Marketable equity securities Total Less current portion Noncurrent portion
14,142,277 314,150 1,361,283 1,594,097 1,938,527 557,523 647,171 771,654 21,326,682 19,335,590
1,991,092
15

2011
2010
Assets whose use is limited: Held by bond trustees under trust indentures, Cash and cash equivalents Self-insurance funds: Cash and cash equivalents U.S. government obligations U.S. government mortgage-backed obligations Total Under deferred compensation plans: Cash and cash equivalents Mutual funds equities Mutual funds fixed income Total under deferred compensation plans Donor restricted: Cash and cash equivalents Certificates of deposit Mutual funds equities Mutual funds fixed income U.S. government obligations Corporate bonds Marketable equity securities Total Total assets whose use is limited Less current portion Noncurrent portion
18,054,612
21,810,981
4,657,518 14,940,795 11,762,700 31,361,013
2,623,318 11,325,390 10,905,925 24,854,633
30,432 2,071,604 2,102,036
30,654 1,511,132 73,633 1,615,419
994,708 127,284 1,631,556 748,223 608,116 314,835 284,036 4,708,758 56,226,419 2,203,372 $ 54,023,047 $
388,638 336,517 1,418,158 499,361 927,661 480,984 596,642 4,647,961 52,928,994 2,214,214 50,714,780
16

Investment income, gains and losses on investments, assets whose use is limited, and cash and cash equivalents are comprised of the following in 2011 and 2010:
2011 Unrestricted Temporarily Unrestricted Unrestricted 2010 Temporarily Unrestricted
Investment income: Interest and dividend income Realized (losses) gains, net Total Change in net unrealized gains and losses on trading securities
1,450,603 126,397
123,226 52,781
1,524,338 37,232
206,815 30,980
1,577,000
176,007
1,561,570
237,795
1,052,441
(104,636)
631,416
214,922
6. Fair Value Measurements The JFK Health System measured its investments and assets whose use is limited on a recurring basis in accordance with accounting principles generally accepted in the United States of America. Fair value is defined as the price that would be received to sell an asset or the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The framework that the authoritative guidance establishes for measuring fair value includes a hierarchy used to classify the inputs used in measuring fair value. The hierarchy prioritizes the inputs used in determining valuations into three levels. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The levels of the fair value hierarchy are as follows: Level 1 - Fair value is based on unadjusted quoted prices in active markets that are accessible to the JFK Health System for identical assets. These generally provide the most reliable evidence and are used to measure fair value whenever available. Level 2 - Fair value is based on significant inputs, other than Level 1 inputs, that are observable either directly or indirectly for substantially the full term of the asset through corroboration with observable market data. Level 2 inputs include quoted market prices in active markets for similar assets, quoted market prices in markets that are not active for identical or similar assets, and other observable inputs. Level 3 - Fair value would be based on significant unobservable inputs. Examples of valuation methodologies that would result in Level 3 classification include option pricing models, discounted cash flows, and other similar techniques.
17

These items were measured with the following inputs at December 31, 2011:
Level 1 Level 2 Level 3 Total
Cash and cash equivalents Certificates of deposit Mutual funds equities Mutual funds fixed income U.S. government mortgage-backed obligations U.S. government agency obligations U.S. government obligations Corporate bonds Marketable equity securities Beneficial interest in perpetual trusts Total
37,879,547 5,641,687 1,305,746
441,434 -
37,879,547 441,434 5,641,687 1,305,746
1,594,097 16,910,194 1,055,690 $ 64,386,961 $
11,762,700
4,327,504 $ 4,327,504 $
11,762,700 1,594,097 16,910,194 962,006 1,055,690 4,327,504 81,880,605
962,006 13,166,140
These items were measured with the following inputs at December 31, 2010:
Level 1 Level 2 Level 3 Total
Cash and cash equivalents Certificates of deposit Mutual funds equities Mutual funds fixed income U.S. government mortgage-backed obligations U.S. government agency obligations U.S. government obligations Corporate bonds Marketable equity securities Beneficial interest in perpetual trusts Total
38,197,318 4,835,807 958,101
1,076,886 -
38,197,318 1,076,886 4,835,807 958,101
1,313,894 14,086,271 1,710,607 $ 61,101,998 $
10,905,925 1,159,582 13,142,393 $
4,452,935 4,452,935 $
10,905,925 1,313,894 14,086,271 1,159,582 1,710,607 4,452,935 78,697,326
18

Level 1 and Level 2 investments and assets whose use is limited are valued at fair value based on quoted market prices, or similar assets quoted market prices. Level 3 investments are valued using discounted cash flow methodologies. Beneficial interest in perpetual trusts contain eleven trusts established in which MRMC receives between 2.5% and 100% of the annual income and gains and losses. These trusts are discounted using an average interest rate of 2.3%. Two of the trusts were established in which Muhlenberg Foundation receives between 25% and 100% of the annual income and gains and losses and are discounted using an average interest rate of 2.9%. The Muhlenberg Foundation and MRMC measure their beneficial interest in perpetual trusts at fair value based on the funds underlying investments using unobservable inputs (Level 3) in accordance with accounting principles generally accepted in the United States of America. Changes to the beneficial interest in perpetual trusts in 2011 and 2010 were as follows:
2011 2010
Beginning balance Investment income from beneficial interest in perpetual trusts Distributions from beneficial interest in perpetual trusts Valuation (loss) gain, net Ending balance
4,452,935 141,151 (141,151) (125,431)
4,180,129 120,050 (120,050) 272,806
4,327,504
4,452,935
Valuation (loss) gain is reported as changes in permanently restricted net assets within the statement of changes in net assets. Distributions from beneficial interests in perpetual trusts are reported as permanently restricted contributions within the statement of changes in net assets in accordance with trust documents.
19

7. Property and Equipment Property and equipment at December 31, 2011 and 2010 are as follows:
2011 2010 $ 17,363,102 267,545,425 42,811,046 186,627,337 646,022 6,185,313 7,154,092 528,332,337 373,183,278 $ 155,149,059
Land and land improvements Buildings and improvements Fixed equipment Movable equipment Leasehold improvements Capitalized leases Construction in progress Total Less accumulated depreciation Property and equipment, net
17,363,103 274,677,871 43,065,121 192,990,830 646,022 9,027,373 6,717,268 544,487,588 389,116,251
$ 155,371,337
Due to the closure of the acute care facility of MRMC, cumulative impairments of $13,456,658 and $12,849,088 are recorded against building and improvements and equipment assets as of December 31, 2011 and 2010, respectively, in the table above. The JFK Health System capitalizes the interest cost on borrowings, net of income earned on certain proceeds from the borrowings, as a component of the cost of the asset acquired or constructed. Accordingly, interest costs of $645,593 and $790,800 were capitalized in 2011 and 2010, respectively. In connection with the sale of Midtown Shops, the following assets are shown as property and equipment held for sale as of December 31, 2010.
2010
Land Buildings and other depreciable assets Less accumulated depreciation Total
3,880,000 56,252 (5,771) 3,930,481
Midtown Shops property was sold during 2011.
20

8. Pledges Receivable Capital pledge campaigns have been undertaken to raise funds in connection with construction of the Schools of Nursing, Medical Imaging, and Therapeutic Services at MRMC and construction of an Ambulatory Care Services Building, improvements to the Emergency Department, and supporting the Intensity Modulated Radiation Therapy project (along with other medical technology investments) at JFK Medical Center. Pledges related to these campaigns have been recorded as temporarily restricted contributions. Pledges receivable are recorded as follows as of December 31, 2011 and 2010:
2011 2010
Capital campaign pledges before unamortized discount and allowance for uncollectible pledges Unamortized discount Subtotal Allowance for uncollectible pledges Net unconditional promises to give
$ 1,047,582 (21,859) 1,025,723 (82,598) $ 943,125 2011
$ 390,025 (15,974) 374,051 (34,528) $ 339,523 2010 $ 120,418 269,607 $ 390,025
Amounts due in: Less than one year One to five years Total
$ 363,634 683,948 $ 1,047,582
The discount rate used was .90% at December 31, 2011 for new pledges. The discount rate used in old pledges remained at 4.7% at December 31, 2011. Current portion of pledges receivable net of allowance for uncollectible pledges is included in prepaid expenses and other current assets. Due to the closure of MRMC, as disclosed in Note 1, an allowance for uncollectible pledges has been recorded against all Muhlenberg Foundation pledges at December 31, 2011 and 2010.
21

9. Accrued Expenses Accrued expenses at December 31, 2011 and 2010 are as follows:
2011 2010 $ 5,804,847 11,001,809 4,542,724 159,629 1,524,651 2,133,048 1,952,425 696,371 3,189,824 950,610 405,685 32,361,623
Salaries and wages Paid time off Employee benefits Unemployment Other Interest Refund over payments Payroll taxes Severance Occupational/physical therapy services Provider tax assessment Total 10. Long-Term Debt and Capital Lease Obligations Series 2009 A-1 Bonds, Obligated Group
6,601,500 11,527,161 4,211,214 10,000 1,595,374 2,109,967 2,249,243 762,541 1,745,671 663,995 387,186 31,863,852
In June 2009, the New Jersey Health Care Facilities Financing Authority (the Authority) issued $152,925,000 to JFK Medical Center, Oak Tree, and MRMC (the Borrowers) Series 2009 A-1 Bonds (Series of 2009 A-1 Bonds) under the State of New Jersey Hospital Asset Transformation Program (HATP). The Series of 2009 A-1 Bonds include serial bonds of $5,930,000, maturing through October 1, 2014 with interest at 4.0%, term bonds of $30,540,000 with interest at 5% due through October 1, 2019, term bonds of $40,735,000 with interest at 5.25% due through October 1, 2024, and term bonds of $75,720,000 with interest of 5.75% due through October 1, 2031. Principal payments are not due until October 1, 2013. The Series 2009 A-1 Bonds refinanced various series of bonds issued on behalf of, and other indebtedness of JFK Medical Center, Hartwyck at Oak Tree, and MRMC, all in connection with the termination of the provision of hospital acute-care services at MRMC and pursuant to the States HATP, paying the costs of issuance of the Series 2009 A-1 Bonds and providing funds for various capacity expansion and capital improvement projects at JFK Medical Center.
22

Series 2001 Bonds, Whispering Knoll and Hartwyck West In September 2001, the Authority issued $15,260,000 of Revenue Bonds as JFK Assisted Living and Hartwyck West Nursing Home, Series 2001 (Series 2001 Bonds). Whispering Knolls portion of the Series 2001 Bonds is payable in monthly installments of $87,374, including interest at 5.65% through September 1, 2011. On September 1, 2011 and September 1, 2021, the interest rate will be reset to a fixed rate equal to the then-in-effect weekly average yield on United States Treasury Bonds. Whispering Knolls portion of the Series 2001 Bonds matures on January 1, 2026. Hartwyck Wests portion of the Series 2001 Bonds is payable in monthly installments of $21,662, including interest at 5.65%, and matured October 1, 2008. The proceeds of the Series 2001 Bonds were used to refinance a construction loan and other costs associated with the existing debt with the Authority and pay for issuance costs. Payments of principal and interest on the Series 2001 Bonds are collateralized by a pledge of revenues and property of Whispering Knoll, guaranteed by Hartwyck West, and are insured by Old Republic National Title Insurance Company. Mortgage Notes Payable In August 2008, Hartwyck West entered into a mortgage with a bank for $5,680,000, which bears interest at a variable rate through August 13, 2013. The interest rate was 2.27% as of December 31, 2011. The mortgage is secured by the Cedar Brook facility. In August 2008, Whispering Knoll entered into a mortgage with a bank for $3,500,000 which bears interest at a variable rate through August 13, 2013. The interest rate was 2.27% as of December 31, 2011. The mortgage is secured by the Whispering Knoll facility. In June 1998, Healthshare, Inc. borrowed $2,200,000 under a mortgage note collateralized by certain land, building and equipment. The proceeds of the mortgage were used to pay an existing mortgage note and to purchase certain property, plant and equipment. In October 2002, Healthshare, Inc. modified the 1998 mortgage note to include interest at 6.3% rather than 7.28%. The agreement was again modified on June 17, 2008 with a maturity date of June 17, 2009. In March 2011, the agreement was modified again with a rate of interest of 1.25% plus the rate of interest of the London InterBank Offered Rate (LIBOR), modified monthly. The maturity date was also modified to October 31, 2013. Interest paid during 2011 and 2010 was $7,252 and $14,722 respectively.
23

The JFK Health Systems long-term debt at December 31, 2011 and 2010 consists of the following:
2011 2010
New Jersey Health Care Facilities Financing Authority Revenue Bonds: Series 2009 A-1 Bonds, Obligated Group Series 2001 Bonds, Whispering Knoll Mortgage notes payable: Mortgage payable Whispering Knoll Mortgage payable Hartwyck West Mortgage payable Healthshare, Inc. Total Less current maturities Long-term debt
$ 152,925,000 10,578,446 3,206,699 5,198,081 350,624 172,258,850 966,656 $ 171,292,194
$ 152,925,000 11,062,135 3,294,508 5,343,038 448,019 173,072,700 1,115,415 $ 171,957,285
Under the terms of the various bond indenture agreements with the Authority, Hartwyck West and Whispering Knoll are required to maintain certain financial ratios, comply with other restrictive covenants as described in the respective agreements, and achieve certain occupancy percentages at Whispering Knoll. Hartwyck West and Whispering Knoll were in compliance with their covenants at December 31, 2011. Under the terms of the Series 2009 A-1 bond indenture agreement, the Borrowers collectively are required to maintain certain financial ratios and comply with other restrictive covenants as described in the respective agreement. The Borrowers are required to maintain a minimum days cash on hand ratio of 30 days and its days in accounts payable ratio cannot exceed 90 days. The compliance with the debt coverage ratio covenant began in June 2010. As of December 31, 2011, the Borrowers were in compliance with these required ratios. The JFK Health Systems scheduled principal repayments for long-term debt are as follows: Years Ending December 31 2012 2013 2014 2015 2016 Thereafter Total
$ 966,656 3,510,076 4,418,214 5,630,850 6,919,262 150,813,792
$ 172,258,850
24

New capital lease obligations were entered by JFK Medical Center during 2011 and 2010 and consisted of the following at December 31, 2011 and 2010:
2011 2010
Capital lease obligations with interest ranging from 3.90% to 9.08% per annum, final payment due in 2016 Less current portion Long-term portion
6,535,848 1,673,125
5,285,096 1,153,507
4,862,723
4,131,589
JFK Medical Centers future minimum lease payments under capital lease obligations are as follows: Years ending December 31: 2012 2013 2014 2015 2016 Total minimum payments Less amounts representing interest
$ 2,069,750 2,169,313 1,659,472 1,154,286 378,951 7,431,772 895,924 6,535,848
Less current installments

$
1,673,125 4,862,723
11. Pension Plans and Postretirement Healthcare Benefits Cash Balance Retirement Plan The JFK Health System Health System The JFK Health System has a defined benefit pension plan covering substantially all JFK Medical Center employees and the employees of other participating subsidiaries. Amounts are allocated by the JFK Health System to its subsidiaries based upon relative service costs. The JFK Health System uses a December 31 measurement date for its pension plan. The plan was frozen effective May 2, 2009.
25

The changes in projected benefit obligations in 2011 and 2010 are as follows:
2011 2010 $ 228,819,833 14,463,277 26,448,074 (10,065,549) $ 259,665,635 $ 259,665,635
Projected benefit obligation at beginning of year Interest cost Actuarial gain Benefits paid Projected benefit obligation at end of year Accumulated benefit obligation
$ 259,665,635 13,324,022 633,722 (10,446,573) $ 263,176,806 $ 263,176,806
The changes in plan assets in 2011 and 2010 are as follows:

2011 2010 $ 158,449,405 19,608,363 8,471,072 (10,065,549) $ 176,463,291
Fair value of plan assets at beginning of year Actual return on plan assets Employer contributions Benefits paid Fair value of plan assets at end of year
$ 176,463,291 4,378,612 11,639,554 (10,446,573) $ 182,034,884
The following is a summary of the funded status of the plan at December 31, 2011 and 2010:
2011 2010 $ 176,463,291 259,665,635 $ (83,202,344) $ 259,665,635
Fair value of plan assets Projected benefit obligation Funded status of the plan (under funded) Accumulated benefit obligation
$ 182,034,884 263,176,806 $ (81,141,922) $ 263,176,806
26

The components of net periodic pension cost for 2011 and 2010 are as follows:
2011 2010 $ 14,463,277 (12,641,893) 1,484,044 3,305,428
Interest cost Expected return on plan assets Amortization of actuarial loss Net periodic pension cost
13,324,022 (13,896,207) 1,953,142 1,380,957
A net actuarial loss of $10,151,316 represents the previously unrecognized components of net periodic pension cost included in unrestricted net assets at December 31, 2011. A net actuarial loss of $2,246,098 represents the unrecognized component of net periodic benefit cost included in unrestricted net assets at December 31, 2011 expected to be amortized into net periodic pension cost in 2012. The following table provides the amounts recognized in the consolidated balance sheet at December 31, 2011 and 2010:
2011 2010 $ 84,627,015
Net amount recognized - noncurrent
81,141,922
During 2011 and 2010, an additional $1,206,341 and $1,424,671, respectively, was included in accrued pension cost to cover inactive MRMC participants through 2013 calculated by the actuary. The contribution to the plan in 2012 is expected to be $12,789,000. The weighted-average assumptions used in computing the plans benefit obligation at December 31, 2011 and 2010 are as follows:
2011 2010 5.34 % N/A
Discount rate Rate of compensation increase
4.53 % N/A
27

The weighted-average assumptions used in the measurement of the plans net periodic pension cost for the years ended December 31, 2011 and 2010 are as follows:
2011 010 6.43 % 8.00 N/A
Discount rate Expected long-term rate of return on plan assets Rate of compensation increase
5.34 % 8.00 N/A
The expected long-term rate of return on plan assets assumption was developed based on historical returns for the major asset classes. This review also considered both current market conditions and projected future conditions. Adjustments are made to the expected long-term rate of return assumption when deemed necessary based upon revised expectations of future investment performance of the overall capital markets. The expected long-term rate of return assumption used in computing 2011 net periodic pension cost was 8.0%. The following table sets forth the actual asset allocation and target asset allocation for plan assets at December 31, 2011 and 2010:
Target Asset Allocation 51 33 16 %
2011
Asset category: Equity securities Debt securities Alternative investments Collective fund
51 % 35 14
2010
Target Asset Allocation 50 35 15 %
Asset category: Equity securities Debt securities Alternative investments Collective fund
53 % 33 14
The plan assets are invested among and within various asset classes in order to achieve sufficient diversification in accordance with The JFK Health Systems risk tolerance. This is achieved through the utilization of asset managers and systemic allocation to investment management styles, providing a broad exposure to different segments of the fixed income and equity markets. The following benefit payments, which reflect expected future services, as appropriate, are expected to be paid: Years ending December 31: 2012 2013 2014 2015 2017 2018 2021 28
$ 10,748,633 12,902,701 12,040,036 11,964,562 15,760,244 84,080,835

The composition of plan assets at December 31, 2011 and 2010, is set forth in the following table:
2011 2010
Mutual funds: Large cap Small cap Equities Emerging markets debt fund High yield bond fund Long duration fund Collective funds Total
52,866,038 11,316,107 28,784,871 7,055,130 14,776,545 41,935,145 25,301,048
51,960,845 11,681,987 29,450,885 6,717,096 14,075,299 36,948,736 25,628,443
$ 182,034,884
$ 176,463,291
The plans collective fund, an alternative investment, is comprised of limited partnerships that invest primarily in securities that are traded in active markets. Its investment objective is to deliver a 7% rate of return, but with approximately half of the annualized volatility of equities. This approach can generate investment results that achieve higher long-term returns; however, this approach can also produce negative results depending on market conditions. The following table sets forth by level, within the fair value hierarchy, the plan assets at fair value as of December 31, 2011:
Assets at Fair Value as of December 31, 2011 Level 1 Level 3 Total
Mutual funds: Large cap Small cap Equity Emerging markets debt fund High yield bond fund Long duration fund Collective funds Total
52,866,038 11,316,107 28,784,871 7,055,130 14,776,545 41,935,145 -
25,301,048 25,301,048
52,866,038 11,316,107 28,784,871 7,055,130 14,776,545 41,935,145 25,301,048
$ 156,733,836
$ 182,034,884
29

The following table sets forth by level, within the fair value hierarchy, the plan assets at fair value as of December 31, 2010:
Assets at Fair Value as of December 31, 2011 Level 1 Level 3 Total
Mutual funds: Large cap Small cap Equity Emerging markets debt fund High yield bond fund Long duration fund Collective funds Total
51,960,845 11,681,987 29,450,885 6,717,096 14,075,299 36,948,736 -
25,628,443 25,628,443
51,960,845 11,681,987 29,450,885 6,717,096 14,075,299 36,948,736 25,628,443
$ 150,834,848
$ 176,463,291
The following table summarizes Level 3 instruments measured at fair value on a recurring basis:
Fair Value Measurements At Reporting Date Using Significant Unobservable Inputs (Level 3) Collective Fund 2011 2010 $ 24,985,779 642,664 $ 25,628,443
Balance, beginning of year Unrealized gain Balance, end of year
25,628,443 (327,395)
25,301,048
The following is a description of the valuation methodologies used for the plans assets measured at fair value: Mutual funds Valued at the net asset value (NAV) of shares held by the plan at year-end. Collective fund (alternative investments) valued by an independent advisor that values the underlying investments of the partnership, which are substantially invested in an active market in which the individual securities are traded.
The preceding methods described may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, although the JFK Health System believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. 30

Defined Contribution Pension Plan On January 1, 2010, the JFK Health System established the Solaris Defined Contribution Pension Plan. All employees are eligible for participation in the plan. JFK Medical Center will contribute a maximum of 2% of employee contributions. Total expense recorded in 2011 and 2010 was $3,234,882 and $3,458,705, respectively. Tax Deferred Annuity Program Oak Tree and Hartwyck Eligible employees of Oak Tree and Hartwyck West may participate in the Hartwyck Nursing Home Tax Deferred Annuity Program (the Hartwyck Plan) pursuant to Section 403(b) of the Internal Revenue Code. The Hartwyck Plan is a noncontributory, defined contribution program covering substantially all employees. Effective November 15, 2006, a new plan was established which provided the same level of benefits as prior years, and the old plan was frozen to new participants. The new plan includes an employer contribution of 2% to a maximum of $500 per employee. Pension expense was approximately $249,000 and $259,000 in 2011 and 2010, respectively. Union Plan Hartwyck at Edison Estates Eligible union employees of Hartwyck at Edison Estates may participate in a noncontributory, defined contribution plan. This union plan is funded based on contributions made in accordance with the plan document. Pension expense was approximately $104,000 in 2011 and $52,000 in 2010. Union Plan Hartwyck at Cedar Brook Eligible union employees of Hartwyck at Cedar Brook may participate in a noncontributory, defined contribution plan. Funding is based on contributions made in accordance with the plan document. Pension expense was approximately $20,521 in 2011 and $20,632 in 2010. Postretirement Healthcare Benefits In addition to the JFK Health Systems defined benefit pension plan, the JFK Health System sponsors two defined benefit medical and life insurance plans for eligible retirees. JFK Medical Center - To be eligible, a retiring employee must have at least 25 years of service (effective January 1, 2005) and have attained age 60; however, those who were 55 years or older and have at least ten years of service as of December 31, 2004 will remain eligible at age 60 years with 15 years of service. No employee hired on or after January 1, 2005 will be eligible for retiree medical coverage. The medical insurance plan requires monthly retiree contributions. As covered, a retiree may elect to cover his or her spouse on a contributory basis. The JFK Health System sets these rates on an annual basis. The medical insurance plan contains other cost-sharing features such as deductibles and coinsurance. The life insurance benefit is provided on a noncontributory basis. The benefit is only for full-time employees who are eligible and enroll in the medical plan. The accounting for the plan anticipates future cost-sharing changes to the written plan that are consistent with past personnel practices and procedures. The JFK Health Systems funding policy is on a pay-as-you-go basis; the life insurance plan is funded through a group life insurance contract. 31

MRMC - To be eligible, a retiring employee must have at least 10 years of service and have attained age 55. Coverage under the life insurance benefit plan is provided on a noncontributory basis, and the medical insurance plan is partially contributory. The JFK Health Systems funding policy is on a pay-as-you-go basis; the life insurance plan is funded through individual life insurance contracts. Both coverages terminate at age 65, when a Medicare supplemental program is provided on a fully contributory basis. In January 2011, the JFK Health System approved a five year phase out of the retiree medical program. Beginning in 2012, the subsidy will be reduced each year by $500 until January 1, 2016 when the medical program will end. This phase out created a reduction of the benefit obligation as of December 31, 2011 of $7,810,880 for the Plan amendments and a curtailment gain of $3,575,470. The changes in benefit obligations in 2011 and 2010 are as follows:
2011 2010 $ 12,727,114 216,482 748,983 836,519 782,062 (1,170,512) 14,140,648
Benefit obligation at beginning of year Service cost Interest cost Plan participants contributions Plan changes Actuarial loss Benefits paid Curtailment Benefit obligation at end of year
14,140,648 71 42,765 870,156 (7,810,880) (545,110) (1,238,991) (3,575,470) 1,883,189
The changes in plan assets in 2011 and 2010 are as follows:

2011 2010 $ 333,993 836,519 (1,170,512) -
Fair value of plan assets at beginning of year Employer contribution Plan participants contributions Benefits paid Fair value of plan assets at end of year
368,835 870,156 (1,238,991) -
32

The following is a summary of the funded status and amounts recognized in the JFK Health Systems consolidated financial statements as of December 31, 2011 and 2010:
2011 2010 $ 14,140,648
Fair value of plan assets Accumulated benefit obligation Funded status of the postretirement plan (under funded) Accrued postretirement healthcare benefit liability at end of year Less current portion Noncurrent portion of accrued postretirement healthcare benefit liability
1,883,189
(1,883,189)
(14,140,648)
(1,883,189) (718,861)
(14,140,648) (881,649)
(1,164,328)
$ (13,258,999)
The components of net periodic postretirement benefit credit for 2011 and 2010 are as follows:
2011 2010 $ 748,983 216,482 (688,006) 122,989 400,448
Interest cost Service cost Amortization of asset at transition date Amortization of prior service credit Curtailment credit Amortization of actuarial loss Net periodic postretirement benefit credit
42,765 71 (1,756,270) (2,708,535) 304,137 (4,117,832)
A net actuarial gain of $3,297,662 and a prior service cost of $8,633,798 represent the previously unrecognized component of net periodic postretirement benefit cost included in unrestricted net assets at December 31, 2011. A net actuarial loss of $187,745 and a prior service credit of $1,763,442 are expected to be recognized in net periodic postretirement benefit cost in the next year. Weighted-average assumptions used in determining the actuarial present value of the projected benefit obligation for 2011 and 2010 were:
2011 2010 4.98 % 5.36 N/A N/A
Discount rate MRMC Plan Discount rate JFK Medical Center Plan Healthcare cost trend rate Year ultimate increase reached
1.87 % 1.79 N/A N/A
33

Assumed healthcare cost trend rates have a significant effect on the amounts reported for the postretirement benefit plans. However, since the JFK Health System has reached the employer-paid cap on benefits, a one percentage point change in assumed healthcare cost trend rates would not have an effect on the components of net periodic postretirement benefit cost and the postretirement benefit obligations for 2011. The JFK Health System expects to contribute $602,389 to its postretirement benefit plans in 2012. MRMC expects to contribute $116,472 to its postretirement benefit plan in 2012. The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid: Years ending December 31 2012 2013 2014 2015 12. Professional and General Liability Insurance The JFK Health System maintains professional and general liability insurance coverage for all subsidiaries and their employees. The JFK Health Systems insurance coverages are provided under the provisions of two insurance arrangements, as follows: Primary coverage: Primary coverage is provided by AIE. Professional liability is under the terms of a claims-made insurance policy. General liability is under the terms of an occurrence based policy. Both policies have an individual claim limit of $3,000,000 and an annual aggregate limit of $10,000,000. Excess coverage: The JFK Health System has excess liability insurance coverage which insures against losses in excess of the above primary coverage reported during the period of policy coverage. Those commercial excess liability insurance policies have an individual occurrence limit of $30,000,000 and an annual aggregate limit of $30,000,000.
$ 718,861 566,233 406,163 246,130
AIE was incorporated under the laws of Bermuda on June 24, 1987 and insures the risks of The JFK Health System Health System and controlled entities. The JFK Health Systems liability for the estimated future payments of its unasserted medical malpractice and general liability claims was approximately $15,288,000 and $15,022,000 at December 31, 2011 and 2010, respectively, and included in self-insurance reserves in the consolidated balance sheet. In addition, JFK Medical Center has recorded a reserve of approximately $1.7 million for asserted and unasserted professional and general claims which exceed primary coverage which is recorded in other long-term liabilities in the balance sheet as of December 31, 2011. Of these claims, approximately $1.2 million is recorded as a receivable under the claims-made excess liability insurance and is recorded within other long-term assets in the balance sheet as of December 31, 2011. Otherwise, the System believes that it has adequate insurance coverages for all asserted claims and has no knowledge of unasserted claims which would exceed insurance coverages. 34

13. Other Long-Term Liabilities JFK Medical Center has recorded a reserve of approximately $902,000 for asserted and unasserted workers compensation claims which exceed primary coverage which is recorded in other long-term liabilities in the consolidated balance sheet as of December 31, 2011. Of these claims, approximately $902,000 is recorded as a receivable under the claims-made excess liability insurance and is recorded within other long-term assets in the consolidated balance sheet as of December 31, 2011. In August 2011, JFK Medical Center entered into a line of credit agreement with a minimum withdrawal amount of $3 million and a maximum of $27 million. The line of credit is payable in full in August 2014, subject to renewal terms per the line of credit agreement. As of December 31, 2011, JFK Medical Center drew $3 million on the line of credit, which is included in other long-term liabilities in the consolidated balance sheet. 14. Health Insurance Benefits JFK Medical Center and MRMC self-insure their employee health insurance coverages. JFK Medical Center and MRMC accrue the estimated costs of incurred and reported and incurred but not reported claims, after consideration of their individual and aggregate stop-loss insurance coverages, based upon data provided by the third-party administrator of the programs and their historical claims experience. JFK Medical Center and MRMC recorded liabilities of $3,347,557 and $3,612,845 at December 31, 2011 and 2010, respectively, related to health insurance. The amount is included in employee benefits within accrued expenses in the accompanying consolidated balance sheet. 15. Deferred Compensation Plans The JFK Health System has certain deferred compensation and supplemental income plans for key employees. The plans accumulated benefit obligations and fair value of call options on these plans amounted to $1,449,832 and $1,084,536 at December 31, 2011 and 2010, respectively, and are included in other liabilities in the accompanying consolidated balance sheet. The JFK Health System funds the entire amount of accumulated benefit obligations and maintains mutual funds for its key employee share option plan which are included in assets whose use is limited in the accompanying consolidated balance sheet. Benefits paid under these plans amounted to $76,455 in 2011. 16. Temporarily and Permanently Restricted Net Assets Temporarily restricted net assets are related to, or restricted for, the following:
2011 2010
Assets held for betterments to plant facilities and purchases of equipment
13,357,658
12,266,016
35

Permanently restricted net assets are related to the following:

2011 2010
Investments to be held in perpetuity, the income from which is generally available for the JFK Health System operations and programs Beneficial interest in perpetual trusts Total Endowment Funds
3,101,880 4,327,504 7,429,384
3,090,320 4,452,935 7,543,255
The JFK Health Systems endowment funds consist of four funds established for a variety of purposes. The endowments include only donor-restricted endowment funds at the current time. As required by accounting principles generally accepted in the United States of America, net assets associated with endowment funds are classified and reported based upon the existence or absence of donor-imposed restrictions. The JFK Health System has interpreted relevant New Jersey state law governing the net asset classification of endowment funds as requiring the preservation of the fair value of the original gift as of the gift date of the donor-restricted endowment funds absent explicit donor stipulations to the contrary. As a result, the JFK Health System classifies as permanently restricted net assets (a) the original value of gifts donated as permanent endowments; (b) the original value of subsequent gifts to the permanent endowments, and (c) accumulations to the permanent endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. Interest income earned on the endowment funds or market losses in excess of original value of the gift are recorded in either unrestricted or temporarily restricted net assets, depending upon the donor designation. The endowment fund is invested consistent with an investment policy statement that is monitored by the JFK Health Systems board of directors. The investment policy employed is meant to achieve long-term growth while providing modest investment income which would be available for current funding. Funds in the trust are primarily invested in cash and cash equivalents, certificates of deposit, U.S. government obligations, mutual funds, corporate bonds and equities and, in total, strives for a forty/sixty split between fixed income securities and equities. Donor-restricted endowment net assets totaling $3,101,880 at December 31, 2011 and $3,090,320 at December 31, 2010 are classified as permanently restricted net assets in the accompanying balance sheet. During 2011 and 2010, there was approximately $149,000 and $169,000, respectively, of unrealized gains related to endowment funds which were recorded against unrestricted net assets to restore prior year losses.
36

Changes in permanently restricted endowment net assets for the years ended December 31, 2011 and 2010 are comprised of the following:
2011 2010 $ 3,079,270 168,908 11,050
Endowment net assets, beginning of year Total investment return Contributions Total Assets restricted by donor for permanently restricted endowment funds Unrestricted net assets increased for unrealized gains Endowment net assets, end of year 17. Concentrations of Credit Risk
3,090,320 149,181 11,560
3,251,061
3,259,228
(149,181) $ 3,101,880 $
(168,908) 3,090,320
The JFK Health System grants credit without collateral to its patients, some of whom are insured under third-party payor arrangements, primarily with Medicaid, Medicare, and various commercial insurance companies. The mix of receivables at December 31, 2011 and 2010 from patients and third-party payors is as follows:
2011 2010 29 % 4 19 8 39 1 100 %
Medicare Medicaid Blue Cross Aetna Other third-party payors Patients Total
27 % 2 23 9 38 1 100 %
The JFK Health System maintains its cash and cash equivalents with several financial institutions. Cash and cash equivalents on deposit with any one financial institution are insured up to $250,000.
37

18. Contingencies Reopening of Cost Reports In October 2006, MRMC received a letter from Riverbend, the previous New Jerseys Medicare fiscal intermediary, indicating their intention to reopen previously final settled Medicare cost reports for 2001 through 2003. Riverbend cited that the calculations for Disproportionate Share Hospital (DSH) reimbursement for these years may have contained errors in the number of Medicaid eligible days, which is a critical component of the DSH calculation. For these years, Riverbend received information on Medicaid eligible days from the New Jersey Medicaid Agency and the Division of Medical Assistance and Health Services. During 2009, CMS decided not to reopen cost reports for the fiscal years 2001 to 2003. The balances for these years were moved to the 2005 to 2006 cost report years. Utilizing Medicaid eligible days based on the final settled Medicare cost report for 2004, MRMC estimated a potential overpayment of DSH reimbursement for 2005 through 2007 of $2,977,755 as of December 31, 2011. These amounts are included in estimated third-party payor settlements at December 31, 2011 in the accompanying consolidated balance sheet. Asbestos MRMCs building, which was constructed prior to the passage of the Clean Air Act, contains encapsulated asbestos material. Current law requires that this asbestos be removed in an environmentally safe fashion prior to the demolition and renovation of the building. At this time, MRMC does not have plans to renovate this building; and, therefore, a liability for such asbestos removal cannot be reasonably estimated and there is no liability recognized in the accompanying consolidated financial statements. Other The health care industry is subject to numerous laws and regulations of federal, state, and local governments. Compliance with these laws and regulations is subject to future government review and interpretation as well as regulatory actions unknown or unasserted at this time. Government activity continues to increase with respect to investigations and allegations concerning possible violations by health care providers of fraud and abuse statutes and regulations, which could result in the imposition of significant fines and penalties as well as significant repayments for patient services previously billed. Management is not aware of any material incidents of noncompliance that have not been provided for in the accompanying consolidated financial statements; however, the possible future financial effects of this matter on the JFK Health System, if any, are not presently determinable.
38

19. Lease Commitments The JFK Health System is committed under the terms of operating leases for future minimum rental payments on equipment as follows: Years Ending December 31 2012 2013 2014 2015 2016 Total
$ 1,312,245 1,044,459 919,435 62,987 7,831 3,346,957
Rental expense on operating leases was $2,676,079 in 2011 and $3,737,211 in 2010. 20. Functional Expenses The JFK Health System provides health care and other related services to its patients. The classification of expenses related to providing these services approximates the following in 2011 and 2010:
2011 2010
(in thousands) Program services General and administrative Fundraising Education and scholarship Total
$ 458,554 45,310 274 110 $ 504,248 $ 455,395 44,855 210 121 $ 500,581
39

21. Discontinued Operations On August 13, 2008, the acute care hospital operation of MRMC was closed as noted in Note 1. The following represents revenues and costs associated with the operation of the hospital that closed and were classified and presented in discontinued operations for 2011 and 2010:
2011
2010
Unrestricted Revenues, Gains, and Other Support: Net patient service revenues Total unrestricted revenues, gains, and other support Expenses: Employee benefits Supplies and expenses (Recoveries of) provision for doubtful collections Impairment building (See Note 7) Total expenses Loss from Discounted Operations
277,740
277,740
(132,667) 143,304 (330,989) 607,570 287,218 $ (287,218) $
(269,756) 654,158 (560,718) 1,040,873 864,557 (586,817)
Accounts payable, accrued expenses, and other liabilities accrued associated with discontinued operations will be satisfied through remaining assets and support from the JFK Health System.
40
Independent Auditors Report on Supplementary Information

Board of Directors JFK Health System, Inc. and Controlled Entities Our audits were conducted for the purpose of forming an opinion on the consolidated financial statements as a whole. The additional information on pages 42 through 49 is presented for purposes of additional analysis rather than to present the financial position, results of operations, and cash flows of the individual companies and is not a required part of the consolidated financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the consolidated financial statements. The information has been subjected to the auditing procedures applied in the audit of the consolidated financial statements and certain additional procedures applied in the audit of the consolidated financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the consolidated financial statements or to the consolidated financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the consolidated financial statements as a whole.
Clark, New Jersey May 1, 2012
41
JFK Health System, Inc and Controlled Entities

Schedule of Consolidating Information, Balance Sheet December 31, 2011
JFK Health System Atlantic Insurance Exchange JFK Medical Center
MRMC
Healthshare
Lifestyle
JFK Foundation
Muhlenberg Foundation
Hartwyck Oak Tree
Hartwyck West
Hartwyck at JFK
Consolidation Eliminations Consolidated
Assets Current Assets Cash and cash equivalents Funds held for residents Investments Assets whose use is limited Accounts receivable, patients (net of estimated allowance for doubtful collections of $13,639,000) Inventories of drugs and supplies Prepaid expenses and other current assets Note Receivable, Affiliate Due from affiliates Total current assets Investments Assets Whose Use is Limited Property and Equipment, Net Property and Equipment Held For Sale, Net Deferred Financing Costs, Net Pledges Receivable, Net Other Assets Beneficial Interest in Net Assets of Affiliate Note Receivable, Affiliate Beneficial Interest in Perpetual Trusts Due from Affiliates Total
$
556,129 -
34,842,410 16,449,218 2,203,372
1,651,563 -
308,320 -
44,143 -
3,787,331 1,486,924 -
3,439,520 1,399,448 -
3,151,650 91,007 -
5,208,572 134,229 -
52,989,638 225,236 19,335,590 2,203,372
2,659,309 -
2,561,243 2,561,243 31,361,013 -
50,841,007 6,096,788 5,345,625 93,000 145,113 116,016,533 15,851,240 105,680,185 3,337,250 3,003,293
428,523 244,474 2,324,560 1,826,564 14,167,434 391,957 355,971
108,187 183 416,690 1,872,550 271,608
62,936 38,707 145,786 -
26,956 246,629 5,547,840 70,050 1,144,785 377,358 722,935 24,094
91,869 4,930,837 1,921,042 1,773,743 -
7,785,450 143,677 29,378 1,842 11,203,004 14,840,891 364,164 -
2,224,728 38,344 0 1,990 7,607,863 14,923,138 174,135 539,188
2,713 2,713 2,849,655 -
(3,461,950) (93,000) (393,602) (3,948,552) -
60,914,121 6,305,765 8,050,233 150,023,955 1,991,092 54,023,047 155,371,337 4,267,506 722,935 5,509,720
3,215,438 2,065,702 660,126 1,315,566
212,974 7,469,806
2,000,000 $ 35,922,256 $
7,178,506 2,966,343 910,180 254,943,530 $
9,446,030 2,261,137 32,762 30,806,415
92,817 $ 2,653,665 $
145,786 $
242,948 8,130,010
2,066,367 100,639 $ 10,792,628 $
4,260 26,412,319 $
6,989,033 30,233,357 $
1,434 2,853,802 $
(16,624,536) (2,966,343) (10,587,047) (34,126,478) $
4,327,504 376,237,096
42

MRMC
Healthshare
Lifestyle
JFK Foundation
Hartwyck Oak Tree
Hartwyck West
Hartwyck at JFK
Liabilities and Net (Deficit) Assets Current Liabilities Current maturities of long-term debt Current maturities of capital lease obligations Funds held for residents Accounts payable Accrued expenses Estimated third-party payor settlements Accrued postretirement benefits Other current liabilities Notes payable to affiliates Due to affiliates Total current liabilities Long-Term Debt Capital Lease Obligations Estimated Third-Party Payor Settlements Self-insurance Reserves Accrued Pension Cost Accrued Postretirement Benefits Other Liabilities Note Payable, Affiliate Due to Affiliates Total liabilities Net (Deficit) Assets Unrestricted Temporarily restricted Permanently restricted Total net (deficit) assets Total
$
604,640 59,967 664,607 -
2,242,156 373,840 2,615,996 -
1,673,125 28,799,310 27,134,574 5,096,710 602,389 2,466,048 65,772,156 119,636,336 4,862,723
312,868 116,101 4,431,325 116,472 4,976,766 17,275,000 -
116,875 18,083 4,049 17 139,024 233,749 -
2,698 2,698 -
41,685 12,309 53,994 -
9,597 9,597 -
91,007 877,303 3,817,534 595,658 186,000 5,567,502 16,013,664 -
849,781 134,229 335,367 1,071,459 177,960 50,750 2,619,546 18,133,445 -
(862,221) (2,606,592) (186,000) (373,857) (4,028,670) -
966,656 1,673,125 225,236 30,127,035 31,863,852 10,301,653 718,861 2,516,798 78,393,216 171,292,194 4,862,723
1,418,275 34,541,961 36,624,843
24,147,699 26,763,695
11,522,917 67,347,794 933,233 5,572,455 275,647,614
2,937,494 15,000,469 231,095 36,334 41,938,173 82,395,331
38,707 252,571 664,051
19,562 22,260
566,725 620,719
2,036,496 2,046,093
2,230,571 2,873,343 6,981,986 33,667,066
593,331 539,188 78,193 21,963,703
2,853,802 2,853,802
(2,873,343) (89,269,469) (96,171,482)
17,284,313 24,147,699 82,348,263 1,164,328 7,604,959 387,097,695
(29,155,037) (29,155,037) 7,469,806
9,158,561 9,158,561 $ 35,922,256 $
(27,882,590) 7,178,506 (20,704,084) 254,943,530 $
(64,883,131) 5,864,831 7,429,384 (51,588,916) 30,806,415
1,989,614 1,989,614 $ 2,653,665 $
123,526 123,526 145,786 $
330,785 7,178,506 7,509,291 8,130,010
(699,495) 5,605,842 3,840,188 8,746,535 $ 10,792,628 $
(7,254,747) (7,254,747) 26,412,319 $
8,269,654 8,269,654 30,233,357 $
2,853,802 $
78,355,219 (12,470,027) (3,840,188) 62,045,004 (34,126,478) $
(31,647,641) 13,357,658 7,429,384 (10,860,599) 376,237,096
43

Schedule of Consolidating Information, Statement of Operations Year Ended December 31, 2011 JFK Health System Unrestricted Revenues, Gains, and Other Support: Net patient service revenues Other revenues Resident fees Special events Net assets released from restrictions used in operations Contributions Total unrestricted revenues, gains, and other support Expenses Salaries and wages Employee benefits Supplies and expenses Special events - unrestricted Provision for doubtful collections Depreciation and amortization Interest Total expenses Operating Income (Loss) Loss on Sale of Property Provision for Doubtful Collections on Related Party Receivables Pension Settlement and Curtailment Changes Investment Income Change in Net Unrealized Gains and Losses on Trading Securities Other Gain (Loss) Revenues in Excess of (Less Than) Expenses Pension/Postretirement Liability Adjustment Net Assets Released from Restrictions for Capital Purchases Distributions Transfers (To) From Affiliates Decrease (Increase) in Unrestricted Net Deficit from Continuing Operations Loss From Discontinued Operations Decrease (Increase) in Unrestricted Net (Deficit)
Atlantic Insurance Exchange JFK Medical Center
MRMC
Healthshare
Lifestyle
JFK Foundation
Hartwyck Oak Tree
Hartwyck West
Hartwyck at JFK
4,053,844 -
(1,809,020) -
$ 431,482,321 16,073,820 101,866 -
2,980,457 97,062 -
541,646 -
$ 930,156 1,527 -
531,005 209,715 245,609 33,274
110,370 336,853
40,906,496 396,885 -
9,385,182 6,835,570 -
(3,859,848) -
$ 482,704,155 18,910,316 6,835,570 209,715 554,907 370,127
4,053,844
(1,809,020)
447,658,007
3,077,519
541,646
931,683
1,019,603
447,223
41,303,381
16,220,752
(3,859,848)
509,584,790
2,780,270 426 2,780,696 1,273,148 -
167,151 167,151 (1,976,171) -
197,007,810 39,715,879 150,475,375 31,068,503 13,732,473 6,470,250 438,470,290 9,187,717 -
1,189,578 131,509 2,543,735 107,719 532,144 933,006 5,437,691 (2,360,172) (30,909)
35,044 7,793 389,502 (5,569) 124,416 20,907 572,093 (30,447) -
111,853 19,889 450,689 582,431 349,252 -
44,300 9,883 684,354 101,507 9,350 1,251 850,645 168,958 -
62,363 13,864 142,863 219,090 228,133 -
18,586,884 4,444,622 15,186,183 2,025,346 1,234,262 1,022,436 42,499,733 (1,196,352) -
7,175,645 1,987,029 4,630,295 521,942 722,709 700,949 15,738,569 482,183 -
(24,000) (2,891,340) (155,077) (3,070,417) (789,431) -
224,213,477 46,306,468 174,559,077 101,507 33,727,291 16,347,681 8,992,471 504,247,972 5,336,818 (30,909)
2,529,365 -
835,988
461,942 2,692,503 507,260
257,159
972
107,612
14,881
8,205
(2,991,307) (155,077)
2,692,503 1,577,000
(25,031) 3,777,482 -
1,223,008 82,825 -
33,206 12,882,628 322,399
(170,037) (2,303,959) (417,918)
(34,625) (65,072) -
349,252 -
169,930 -
(8,705) 327,040 -
(1,181,471) -
490,388 -
(3,935,815) -
1,052,441 (34,625) 10,593,228 (95,519)
(231,555) (119,097)
365,790 (2,646,689)
28,275 3,006,689
(360,000)
108,965
134,524
(124,392)
394,065 (231,555) -
3,426,830 -
82,825 -
10,924,128 -
313,087 (287,218)
(65,072) -
(10,748) -
169,930 -
327,040 -
(1,072,506) -
624,912 -
(4,060,207) -
10,660,219 (287,218)
3,426,830
82,825
10,924,128
25,869
$ (65,072)
$ (10,748)
169,930
$ 327,040
(1,072,506)
624,912
(4,060,207)
10,373,001
44

Schedule of Consolidating Information, Changes in Net (Deficit) Assets Year Ended December 31, 2011
JFK Health System Atlantic Insurance Exchange JFK Medical Center Eliminating and Consolidating Entries
MRMC
Healthshare
Lifestyle
JFK Foundation
Hartwyck at Oak Tree
Hartwyck West
Hartwyck at JFK
Consolidated Balance
Unrestricted Net Assets Revenues in excess of (less than) expenses Transfers (to) from affiliates Minimum pension liability adjustment Distributions Net assets released from restrictions for capital purchases Decrease (increase) in unrestricted net deficit from continuous operations Loss from discontinued operations Decrease (increase) in unrestricted net deficit Temporarily Restricted Net Assets Net assets released from restrictions for capital purchases Contributions Special events, net Investment income Transfers from (to) affiliates Net realized and unrealized gains on investments Change in provision for doubtful accounts Net assets released from restrictions for use in operations Change in beneficial interest in net assets of affiliate Increase (decrease) in temporarily restricted net assets Permanently Restricted Net Assets Contributions Change in beneficial interest in net assets of affiliate Change in valuation of beneficial interest trusts (Decrease) increase in permanently restricted net assets Increase/Decrease in Net (Deficit) Assets Net (Deficit) Assets, Beginning Net (Deficit) Assets, Ending
3,777,482 (119,097) (231,555) -
82,825 -
12,882,628 (2,646,689) 322,399 365,790
(2,303,959) 3,006,689 (417,918) 28,275
(65,072) -
$ 349,252 (360,000) -
169,930 -
327,040 -
(1,181,471) 108,965 -
490,388 134,524 -
(3,935,815) (124,392) -
10,593,228 (95,519) (231,555) 394,065
3,426,830 -
82,825 -
10,924,128 -
313,087 (287,218)
(65,072) -
(10,748) -
169,930 -
327,040 -
(1,072,506) -
624,912 -
(4,060,207) -
10,660,219 (287,218)
3,426,830
82,825
10,924,128
25,869
(65,072)
(10,748)
169,930
327,040
(1,072,506)
624,912
(4,060,207)
10,373,001
(365,790) 467,656 (101,866) 1,148,316
(28,275) 15,474 125,337 (97,062) (196,539)
1,452,731 268,420 54,464 (269,963) (16,280) (95,447) (245,609) -
311,899 31,640 106,069 (447,421) (88,356) (110,370) -
124,391 (951,777)
(394,065) 1,764,630 300,060 176,007 (104,636) (95,447) (554,907) -
1,148,316
(181,065)
1,148,316
(196,539)
(827,386)
1,091,642
82,825 9,075,736 $ 9,158,561
(23,233) (90,638)
11,560 (34,793)
23,233 -
11,560 (125,431)
3,426,830 (32,581,867) $ (29,155,037)
12,072,444 (32,776,528) $ (20,704,084)
(113,871) (269,067) (51,319,849) $ (51,588,916) $
(65,072) 2,054,686 1,989,614
(10,748) 134,274 $ 123,526 $
1,318,246 6,191,045 7,509,291 $
(23,233) 107,268 8,639,267 8,746,535 $
(1,072,506) (6,182,241) (7,254,747) $
624,912 7,644,742 8,269,654 $
23,233 (4,864,360) 66,909,364 62,045,004 $
(113,871) 11,350,772 (22,211,371) (10,860,599)
45

JFK Health System Atlantic Insurance Exchange JFK Medical Center JFK Foundation Muhlenberg Foundation Hartwyck Oak Tree Hartwyck West Hartwyck at JFK Consolidation Eliminations Consolidated
MRMC
Healthshare
Lifestyle
Assets Current Assets Cash and cash equivalents Funds held for residents Investments Assets whose use is limited Accounts receivable, patients (net of estimated allowance for doubtful collections of $12,175,000) Inventories of drugs and supplies Prepaid expenses and other current assets Note receivable, affiliate Due from affiliates Total current assets Investments Assets Whose Use is Limited Property and Equipment, Net Property and Equipment Held For Sale, Net Deferred Financing Costs, Net Pledges Receivable, Net Other Assets Beneficial Interest in Net Assets of Affiliate Note Receivable, Affiliate Beneficial Interest in Perpetual Trusts Due From Affiliates Total
$
674,994 -
24,552,857 16,175,528 2,214,214
1,441,971 283,528 -
216,710 -
59,861 -
2,939,946 1,454,906 -
3,249,322 842,257 -
3,342,559 80,594 -
4,263,189 155,581 -
40,741,409 236,175 18,756,219 2,214,214
2,348,593 3,023,587 1,505,169 727,902 1,359,626
3,830,934 3,830,934 24,854,633 -
52,395,715 6,086,762 6,122,442 93,000 682,422 108,322,940 19,596,767 102,682,857 3,609,755 -
727,584 82,920 539,552 3,075,555 1,886,177 15,259,120 3,930,481 423,962 258,018
135,745 352,455 2,002,871 271,608
77,459 37,180 174,500 -
25,712 155,704 4,576,268 70,050 1,129,126 378,609 231,146 157,890
81,109 4,172,688 2,489,128 1,742,908 -
8,908,955 172,478 23,663 78,726 12,606,975 15,773,222 393,924 -
2,383,491 39,397 13,009 6,854,667 15,475,863 195,445 419,559
2,713 2,713 2,848,615 -
(3,868,114) (93,000) (1,300,700) (5,261,814) -
64,493,204 6,324,349 8,965,898 141,731,468 2,559,178 50,714,780 155,149,059 3,930,481 4,623,086 231,146 2,466,701
206,849 6,823,133 $
5,470,000 34,155,567
6,030,190 3,059,343 633,332 $ 243,935,184 $
9,665,802 2,351,775 61,007 36,911,897 $
193,791 2,820,725
$ 174,500 $
242,948 6,786,037 $
2,101,160 155,110 10,660,994 $
4,260 28,778,381 $
7,419,851 30,365,385 $
1,434 2,852,762
(15,695,992) (3,059,343) (14,388,582) $ (38,405,731)
4,452,935 $ 365,858,834
46

JFK Health System Atlantic Insurance Exchange JFK Medical Center JFK Foundation Muhlenberg Foundation Hartwyck Oak Tree Hartwyck West Hartwyck at JFK Consolidation Eliminations Consolidated
MRMC
Healthshare
Lifestyle
Liabilities and Net (Deficit) Assets Current Liabilities Current maturities of long-term debt Current portion of capital lease obligations Funds held for residents Accounts payable Accrued expenses Estimated third-party payor settlements Accrued pension cost Accrued postretirement benefits Other current liabilities Notes payable to affiliates Due to affiliates Total current liabilities Long-term Debt Estimated Third-party Payor Settlements Capital Lease Obligations Self-insurance Reserves Accrued Pension Cost Accrued Postretirement Benefits Other Liabilities Note Payable, Affiliate Due to Affiliates Total liabilities Net (Deficit) Assets Unrestricted Temporarily restricted Permanently restricted Total net (deficit) assets Total
$
902,546 75,000 977,546 -
2,150,912 1,210,863 3,361,775 -
1,153,507 29,252,882 28,178,271 1,882,050 751,493 2,069,872 138,065 63,426,140 119,636,336
654,299 851,097 2,918,059 130,156 4,553,611 17,275,000
448,019 7,978 4,023 460,020 -
3,558 3,558 -
20,811 16,850 37,661 -
11,106 11,106 -
80,594 1,149,338 3,908,334 426,710 93,000 20,867 5,678,843 16,013,664
667,396 155,581 362,416 1,069,751 88,472 43,750 2,387,366 19,032,285
(3,907,279) (93,000) (1,369,795) (5,370,074) -
1,115,415 1,153,507 236,175 32,350,270 32,361,623 5,315,291 881,649 2,113,622 75,527,552 171,957,285
453,878 37,973,576 39,405,000
21,718,056 25,079,831
8,582,783 4,131,589 69,057,945 11,876,919 276,711,712
4,476,293 15,569,070 1,382,080 110,251 44,865,441 88,231,746
37,180 268,839 766,039
36,668 40,226
557,331 594,992
2,010,621 2,021,727
1,889,765 3,059,343 8,319,007 34,960,622
880,000 419,559 1,433 22,720,643
2,852,762 2,852,762
(3,059,343) (96,885,678) (105,315,095)
15,828,841 4,131,589 21,718,056 84,627,015 13,258,999 1,020,868 388,070,205
(32,581,867) (32,581,867) 6,823,133 $
9,075,736 9,075,736 34,155,567
(38,806,718) 6,030,190 (32,776,528) $ 243,935,184 $
(64,909,000) 6,045,896 7,543,255 (51,319,849) 36,911,897 $
2,054,686 2,054,686 2,820,725
134,274 134,274 $ 174,500 $
160,855 6,030,190 6,191,045 6,786,037 $
(1,026,535) 5,802,381 3,863,421 8,639,267 10,660,994 $
(6,182,241) (6,182,241) 28,778,381 $
7,644,742 7,644,742 30,365,385 $
2,852,762
82,415,426 (11,642,641) (3,863,421) 66,909,364 $ (38,405,731)
(42,020,642) 12,266,016 7,543,255 (22,211,371) $ 365,858,834
47

Schedule of Consolidating Information, Statement of Operations Year Ended December 31, 2010
MRMC
Healthshare
Lifestyle
JFK Foundation
Hartwyck Oak Tree
Hartwyck West
Hartwyck At JFK
Unrestricted Revenues, Gains, and Other Support Net patient service revenues Other revenues Resident fees Net assets released from restrictions used in operations Special Events Contributions Total unrestricted revenues, gains, and other support Expenses Salaries and wages Employee benefits Supplies and expenses Special events - unrestricted Provision for doubtful collections Depreciation and amortization Interest Total expenses Operating Income (Loss) Provision For Doubtful Collections On Related Party Receivables Gain on Sale of Home Health Program Investment Income (Loss) Change In Net Unrealized Gains and Losses on Trading Securities Other Gain (Loss) Revenues in Excess of (Less Than) Expenses Pension/Postretirement Liability Adjustment Net Assets Released from Restrictions for Capital Purchases Transfers (to) from Affiliates
2,425,201 -
4,905,494 -
413,398,234 13,369,076 364,742 -
6,725,960 3,045,832 77,153 -
585,599 -
$ 819,037 3,132 -
537,024 207,251 230,750 90,375
120,638 309,839
41,060,852 372,000 -
9,120,766 1,743 6,770,008 -
(3,509,857) -
$ 471,124,849 21,735,244 6,770,008 769,784 230,750 400,214
2,425,201
4,905,494
427,132,052
9,848,945
585,599
822,169
1,065,400
430,477
41,432,852
15,892,517
(3,509,857)
501,030,849
1,471,286 1,471,286 953,915
169,985 169,985 4,735,509
201,710,743 41,418,061 140,890,549 27,093,267 12,743,015 6,161,731 430,017,366 (2,885,314)
6,385,825 1,445,144 2,904,901 21,440 590,491 933,006 12,280,807 (2,431,862)
25,253 5,646 325,869 (20,070) 127,321 14,722 478,741 106,858
113,213 19,576 489,517 622,306 199,863
43,563 9,497 651,936 115,742 1,500 1,509 823,747 241,653
119,200 25,985 153,459 298,644 131,833
18,476,635 4,260,929 15,058,266 2,101,296 1,312,024 1,025,284 42,234,434 (801,582)
7,239,628 1,913,421 4,168,685 409,391 754,064 837,393 15,322,582 569,935
(24,000) (2,956,485) (158,332) (3,138,817) (371,040)
234,114,060 49,074,259 163,327,968 115,742 29,606,824 15,528,424 8,813,804 500,581,081 449,768
431,285 -
945,309
815,147 543,383
4,619,185 110,281
1,392
91,877
16,995
10,665
(1,246,432) (158,332)
4,619,185 1,561,570
(15,881) -
487,654 -
75,111 -
43,683 -
(99,855)
40,849 -
631,416 (99,855)
1,369,319 -
6,168,472 -
(1,451,673) (16,414,404)
2,341,287 (2,984,908)
7,003 -
199,863 -
243,045 -
264,559 -
(784,587) -
580,600 -
(1,775,804) -
7,162,084 (19,399,312)
203,320 185,000
58,868 -
(185,000)
40,860
7,710
(48,570)
262,188 -
(Increase) Decrease in Unrestricted Net Deficit from Continuing Operations Gain from Discontinued Operations (Increase) Decrease in Unrestricted Net (Deficit)
1,369,319 -
6,168,472 -
(17,477,757) -
(584,753) (586,817)
7,003 -
14,863 -
243,045 -
264,559 -
(743,727) -
588,310 -
(1,824,374) -
(11,975,040) (586,817)
1,369,319
6,168,472
(17,477,757)
(1,171,570)
7,003
14,863
243,045
$ 264,559
(743,727)
588,310
(1,824,374)
(12,561,857)
48

Schedule Of Consolidating Information, Changes In Net (Deficit) Assets Year Ended December 31, 2010
JFK Health System Atlantic Insurance Exchange JFK Medical Center Eliminating and Consolidating Entries
MRMC
Healthshare
Lifestyle
JFK Foundation
Hartwyck at Oak Tree
Hartwyck West
Hartwyck at JFK
Consolidated Balance
Unrestricted Net Assets Revenues in excess of (less than) expenses Transfers (to) from affiliates Minimum pension liability adjustment Net assets released from restrictions for capital purchases
1,369,319 -
6,168,472 -
(1,451,673) 185,000 (16,414,404) 203,320
2,341,287 (2,984,908) 58,868
7,003 -
199,863 (185,000) -
243,045 -
264,559 -
(784,587) 40,860 -
580,600 7,710 -
(1,775,804) (48,570) -
7,162,084 (19,399,312) 262,188
(Increase) decrease in unrestricted net deficit from continuous operations Loss from discontinued operations (Increase) decrease in unrestricted net deficit Temporarily Restricted Net Assets Net assets released from restrictions for capital purchases Contributions Special events, net Investment income Transfers from (to) affiliates Change in provision for uncollectible pledges Net realized and unrealized gains on investments Net assets released from restrictions for use in operations Change in beneficial interest in net assets of affiliate Increase (decrease) in temporarily restricted net assets Permanently Restricted Net Assets Contributions Change in beneficial interest in net assets of affiliate Change in valuation of beneficial interest trusts Increase (decrease) in permanently restricted net assets Increase/Decrease in Net (Deficit) Assets Net (Deficit) Assets, Beginning Net (Deficit) Assets, Ending
1,369,319 -
6,168,472 -
(17,477,757) -
(584,753) (586,817)
7,003 -
14,863 -
243,045 -
264,559 -
(743,727) -
588,310 -
(1,824,374) -
(11,975,040) (586,817)
1,369,319
6,168,472
(17,477,757)
(1,171,570)
7,003
14,863
243,045
264,559
(743,727)
588,310
(1,824,374)
(12,561,857)
(203,320) 568,062 (364,742) 520,688
(58,868) 46,787 136,021 (77,153) (40,166)
651,047 269,588 76,293 (404,134) 10,829 124,316 (207,251) -
197,322 28,091 114,715 (350,262) 90,606 (120,638) -
50,313 (480,522)
(262,188) 848,369 297,679 237,795 10,829 214,922 (769,784) -
520,688
6,621
520,688
(40,166)
(430,209)
577,622
138,046 145,810
11,050 126,996
(138,046) -
11,050 272,806
1,369,319 (33,951,186) $ (32,581,867) $
6,168,472 2,907,264 9,075,736
(16,957,069) (15,819,459) $ (32,776,528)
283,856 (881,093) (50,438,756) $ (51,319,849) $
7,003 2,047,683 2,054,686 $
14,863 119,411 134,274 $
763,733 5,427,312 6,191,045 $
138,046 362,439 8,276,828 8,639,267 $
(743,727) (5,438,514) (6,182,241) $
588,310 7,056,432 7,644,742 $
(138,046) (2,392,629) 69,301,993 66,909,364
283,856 (11,700,379) (10,510,992) $ (22,211,371)
49

JFK Financial Statements Dec 31, 2011 and 2010

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JFK Financial Statements Dec 31, 2011 and 2010

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JFK Health System, Inc. (formerly Solaris Health System, Inc.

) and Controlled Entities

JFK Health System, Inc. and Controlled Entities

Independent Auditors Report

Clark, New Jersey May 1, 2012

JFK Health System, Inc. and Controlled Entities

52,989,638 225,236 19,335,590 2,203,372

40,741,409 236,175 18,756,219 2,214,214

60,914,121 6,305,765 8,050,233 150,023,955 1,991,092 54,023,047 155,371,337

64,493,204 6,324,349 8,965,898 141,731,468 2,559,178 50,714,780 155,149,059 3,930,481

1,153,507 236,175 32,350,270 32,361,623 5,315,291 881,649 2,113,622

17,284,313 24,147,699 82,348,263 1,164,328 7,604,959 387,097,695

15,828,841 21,718,056 84,627,015 13,258,999 1,020,868 388,070,205

(31,647,641) 13,357,658 7,429,384 (10,860,599) $ 376,237,096

(42,020,642) 12,266,016 7,543,255 (22,211,371) $ 365,858,834

See notes to consolidated financial statements

JFK Health System, Inc. and Controlled Entities

$ 482,704,155 18,910,316 6,835,570 209,715 554,907 370,127 509,584,790

$ 471,124,849 21,735,244 6,770,008 230,750 769,784 400,214 501,030,849

See notes to consolidated financial statements

JFK Health System, Inc. and Controlled Entities

10,593,228 (95,519) (231,555) 394,065

7,162,084 (19,399,312) 262,188

10,660,219 (287,218) 10,373,001

(11,975,040) (586,817) (12,561,857)

2,064,690 176,007 (104,636) (95,447) (554,907) (394,065) 1,091,642

1,146,048 237,795 214,922 10,829 (769,784) (262,188) 577,622

See notes to consolidated financial statements

JFK Health System, Inc. and Controlled Entities

(2,181,727) 3,896,882 (13,955,461) (12,240,306)

(1,244,056) 4,657,565 (8,992,481) (5,578,972)

43,281 1,383,843 (643,494) (900,217) (116,587) 4,900,394 35,841,015 $ 40,741,409

See notes to consolidated financial statements 5

JFK Health System, Inc. and Controlled Entities

JFK Health System, Inc. and Controlled Entities

JFK Health System, Inc. and Controlled Entities

JFK Health System, Inc. and Controlled Entities

JFK Health System, Inc. and Controlled Entities

JFK Health System, Inc. and Controlled Entities

52,989,638 21,326,682 56,226,419 4,327,504 172,258,850

JFK Health System, Inc. and Controlled Entities

JFK Health System, Inc. and Controlled Entities

JFK Health System, Inc. and Controlled Entities

JFK Health System, Inc. and Controlled Entities

Revenue Expense Revenue (less than) in excess of expense

937,904 1,570,532 (632,628)

JFK Health System, Inc. and Controlled Entities

4,657,518 14,940,795 11,762,700 31,361,013

2,623,318 11,325,390 10,905,925 24,854,633

30,432 2,071,604 2,102,036

30,654 1,511,132 73,633 1,615,419

JFK Health System, Inc. and Controlled Entities

JFK Health System, Inc. and Controlled Entities

37,879,547 5,641,687 1,305,746

37,879,547 441,434 5,641,687 1,305,746

1,594,097 16,910,194 1,055,690 $ 64,386,961 $

11,762,700 1,594,097 16,910,194 962,006 1,055,690 4,327,504 81,880,605

38,197,318 4,835,807 958,101

38,197,318 1,076,886 4,835,807 958,101

1,313,894 14,086,271 1,710,607 $ 61,101,998 $

10,905,925 1,159,582 13,142,393 $

10,905,925 1,313,894 14,086,271 1,159,582 1,710,607 4,452,935 78,697,326

JFK Health System, Inc. and Controlled Entities