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4.Violations of the Conflicts of Interest Policy <br /> a. If the governing board or committee has reasonable cause to believe a member has failed to disclose actual or possible <br /> conflicts of interest, it shall inform the member of the basis for such belief and afford the member an opportunity to explain the <br /> alleged failure to disclose. <br /> b. If,after hearing the member's response and after making further investigation as warranted by the circumstances,the <br /> governing board or committee determines the member has failed to disclose an actual or possible conflict of interest, it shall take <br /> appropriate disciplinary and corrective action. <br /> Article IV <br /> Records of Proceedings <br /> The minutes of the governing board and all committees with board delegated powers shall contain: <br /> a.The names of the persons who disclosed or otherwise were found to have a financial interest in connection with an actual or <br /> possible conflict of interest,the nature of the financial interest,any action taken to determine whether a conflict of interest was <br /> present,and the governing board's or committee's decision as to whether a conflict of interest in fact existed. <br /> b.The names of the persons who were present for discussions and votes relating to the transaction or arrangement,the content <br /> of the discussion,including any alternatives to the proposed transaction or arrangement,and a record of any votes taken in <br /> connection with the proceedings. <br /> Article V <br /> Compensation <br /> a.A voting member of the governing board who receives compensation,directly or indirectly,from the Organization for services is <br /> precluded from voting on matters pertaining to that member's compensation. <br /> b.A voting member of any committee whose jurisdiction includes compensation matters and who receives compensation,directly <br /> or indirectly,from the Organization for services is precluded from voting on matters pertaining to that member's compensation. <br /> c.No voting member of the governing board or any committee whose jurisdiction includes compensation matters and who <br /> receives compensation,directly or indirectly,from the Organization,either individually or collectively,is prohibited from providing <br /> information to any committee regarding compensation. <br /> [Hospital Insert— for hospitals that complete Schedule C <br /> d. Physicians who receive compensation from the Organization,whether directly or indirectly or as employees or independent <br /> contractors, are precluded from membership on any committee whose jurisdiction includes compensation matters.No physician, <br /> either individually or collectively, is prohibited from providing information to any committee regarding physician compensation.] <br /> Article VI <br /> Annual Statements <br /> Each director, principal officer and member of a committee with governing board delegated powers shall annually sign a statement <br /> which affirms such person: <br /> a. Has received a copy of the conflicts of interest policy, <br /> b. Has read and understands the policy, <br /> c. Has agreed to comply with the policy, and <br /> d. Understands the Organization is charitable and in order to maintain its federal tax exemption it must engage primarily in <br /> activities which accomplish one or more of its tax-exempt purposes. <br /> Article VII <br /> Periodic Reviews <br /> To ensure the Organization operates in a manner consistent with charitable purposes and does not engage in activities that could <br /> jeopardize its tax-exempt status,periodic reviews shall be conducted.The periodic reviews shall, at a minimum,include the following <br /> subjects: <br /> a.Whether compensation arrangements and benefits are reasonable, based on competent survey information,and the result of <br /> arm's length bargaining. <br /> b.Whether partnerships,joint ventures,and arrangements with management organizations conform to the Organization's written <br /> policies,are properly recorded,reflect reasonable investment or payments for goods and services,further charitable purposes and <br /> do not result in inurement,impermissible private benefit or in an excess benefit transaction. <br /> Article VIII <br /> Use of Outside Experts <br /> When conducting the periodic reviews as provided for in Article VII,the Organization may, but need not,use outside advisors. If <br /> outside experts are used,their use shall not relieve the governing board of its responsibility for ensuring periodic reviews are <br /> conducted. <br /> -26- Instructions for Form 1023 <br />