990 Return ofOrganization...

l efile GRAPHIC p rint - DO NOT PROCESS As Filed Data - DLN: 93493192007243

Form990 Return of Organization Exempt From Income Tax OMB No 1545-0047

Under section 501 ( c), 527, or 4947( a)(1) of the Internal Revenue Code (except black lung201 1benefit trust or private foundation)

Department of the Treasury

Internal Revenue Service 0- The organization may have to use a copy of this return to satisfy state reporting requirements

A For the 2011 calendar year, or tax year beginning 09-01-2011 and ending 08-31-2012SEEM

B Check if applicableC Name of organization D Employer identification number

Ann & Robert H Lurie Children's Hospital ofF Address change Chicago 36-2170833

Doing Business As E Telephone numberF Name change LURIE CHILDREN'S

F Initial return(312) 227 4306

Number and street (or P 0 box if mail is not delivered to street address ) Room/suite

F_ Terminated 225 E Chicago Ave PR DEPT BOX 26 G Gross receipts $ 858,970,477

1 Amended return City or town, state or country, and ZIP + 4CHICAGO, IL 606112991

1 Application pending

F Name and address of principal officerPatrick M Magoon225 E CHICAGO AVE BOX 269CHICAGO, IL 606112991

I Tax - exempt status F 501(c)(3) 1 501( c) ( ) -4 (insert no ) 1 4947(a)(1) or F_ 527

J Website : 1- www luriechildrens org

H(a) Is this a group return foraffiliates? fl Yes F No

H(b) Are all affiliates included ? fl Yes F_ No

If "No," attach a list (see instructions)

H(c) Group exemption number 0-

K Form of organization F Corporation 1 Trust F_ Association 1 Other 0- L Year of formation 1894 M State of legal domicile IL

Summary

1 Briefly describe the organization's mission or most significant activitiesLURIE CHILDREN'S IS A PEDIATRIC ACADEMIC MEDICAL CENTER PROVIDING PATIENT CARE ANDEDUCATION/TRAINING FOR PHYSICIANS AND OTHER MEDICAL PROFESSIONALS IT IS ALSO A LEADER IN PEDIATRIC

W RESEARCH AND ADVOCACY

2 Check this box Of- if the organization discontinued its operations or disposed of more than 25% of its net assets

3 Number of voting members of the governing body (Part VI, line 1a) . . . . 3 106vt:2 4 Number of independent voting members of the governing body (Part VI, line 1b) . . . 4 91

5 Total number of individuals employed in calendar year 2011 (Part V, line 2a) 5 4,671

6 Total number of volunteers (estimate if necessary) . 6 1,260

7aTotal unrelated business revenue from Part VIII, column (C), line 12 . 7a 435,127

b Net unrelated business taxable income from Form 990-T, line 34 . 7b 139,310

Prior Year Current Year

8 Contributions and grants (Part VIII, line 1h) . 49,693,298 61,771,942

9 Program service revenue (Part VIII, line 2g) 539,278,122 587,037,587

13-10 Investment income (Part VIII, column (A), lines 3, 4, and 7d . . . 3,804,118 33,592,152

11 Other revenue (Part VIII, column (A), lines 5, 6d, 8c, 9c, 10c, and 11e) 574,881 2,568,841

12 Total revenue-add lines 8 through 11 (must equal Part VIII, column (A), line12) . . . . . . . . . . . . . . . . . . 593,350,419 684,970,522

13 Grants and similar amounts paid (Part IX, column (A), lines 1-3) . . . 28,319,947 34,793,643

14 Benefits paid to or for members (Part IX, column (A), line 4) . 0 0-

15 Salaries, other compensation, employee benefits (Part IX, column (A ), lines5-10) 282,320,559 295,955,506

16a Professional fundraising fees (Part IX, column (A), line l le) . 0 0

sC b Total fundraising expenses (Part IX, column (D), line 25) 0-0LLJ

17 Other expenses (Part IX, column (A), lines h1a-11d, 1lf-24e) . . . . 239,202,347 275,211,435

18 Total expenses Add lines 13-17 (must equal Part IX, column (A), line 25) 549,842,853 605,960,584

19 Revenue less expenses Subtract line 18 from line 12 . 43,507,566 79,009,938

Beginning of CurrentEnd of Year

Year

'M 20 Total assets (Part X, l i n e 1 6 ) . . . . . . . . . . . 2,042,087,930 2,206,122,594

21 Total liabilities (Part X, line 26) . . . . . . . . . . . 789,111,961 885,034,333

ZLL 22 Net assets or fund balances Subtract l i n e 2 1 from l i n e 20 1,252,975,969 1,321,088,261

Signature Block

Under penalties of perjury, I declare that I have examined this return, including accoknowledge and belief, it is true, correct, and complete. Declaration of preparer (otherknowledge.

SignSignature of officer

Here PAULA M NOBLE CFO & TREASURERType or print name and title

PreparersIlk

Date

Paidsignature

Preparer' s Firm ' s name (or yours ERNST & YOUNG US LLP

Use Only if self-employed),address, and ZIP + 4 155 NORTH WACKER DRIVE

CHICAGO, IL 60606

May the IRS discuss this return with the preparer shown above? ( see instructs

Form 990 ( 2011)

Statement of Program Service AccomplishmentsCheck if Schedule 0 contains a response to any question in this Part III . F

1 Briefly describe the organization 's mission

WE ARE DEDICATED TO THE HEALTH AND WELL-BEING OF ALL CHILDREN AS THE PEDIATRIC TEACHING FACILITY FORNORTHWESTERN UNIVERSITY' S FEINBERG SCHOOL OF MEDICINE, THIS COMMITMENT DRIVES US TO BE A LEADER IN -PEDIATRIC HEALTH CARE DELIVERY - RESEARCH INTO THE PREVENTION, CAUSES AND TREATMENT OF DISEASES THAT AFFECTCHILDREN - EDUCATION FOR PHYSICIANS, NURSES AND ALLIED HEALTH PROFESSIONALS - ADVOCACY FOR CHILDREN AS ACHARITABLE ORGANIZATION, WE SERVE CHILDREN AND THEIR FAMILIES TO THE BEST OF OUR ABILITIES AND TO THE LIMITSOF OUR RESOURCES

2 Did the organization undertake any significant program services during the year which were not listed onthe prior Form 990 or 990-EZ7 . . . . . . . . . . . . . . . . . . . . fl Yes F No

If"Yes,"describe these new services on Schedule 0

3 Did the organization cease conducting , or make significant changes in how it conducts , any programservices? . . . . . . . . . . . . . . . . . . . . . . . . . . F Yes F No

If"Yes,"describe these changes on Schedule 0

4 Describe the organization's program service accomplishments for each of its three largest program services , as measured byexpenses Section 501(c)(3) and 501( c)(4) organizations and section 4947( a)(1) trusts are required to report the amount ofgrants and allocations to others , the total expenses, and revenue , if any, for each program service reported

4a (Code ) ( Expenses $ 521,011,395 including grants of $ 34,793,643 ) (Revenue $ 589 ,728,256

Ann & Robert H Lurie Children ' s Hospital of Chicago (" Lurie Children ' s") in Chicago, Illinois owns and operates the only full - service, independent , freestandingpediatric hospital in Illinois This not-for- profit, tertiary care hospital , founded in 1882, provides patient care 24 hours per day, 7 days per week Lurie Children's has288 licensed beds and provides a full range of inpatient and outpatient care and related ancillary services Lurie Children's provides more care than any otherhospital provider in Illinois in nearly every pediatric medical and surgical specialty As a major academic tertiary care medical center , Lurie Children ' s has servedpatients from 49 states , and 34 countries Lurie Children ' s is a designated Level I pediatric trauma center for the City of Chicago, with a Level III neonatal nurserythat serves as a regional referral center in the State of Illinois Perinatal Network Lurie Children's ability to treat the most critically ill infants in its neonatal intensivecare unit (" NICU" ) is demonstrated by statistics for calendar year 2012 which show that 64% of all transports into its NICU were from other Level III nurseries inmetropolitan Chicago Lurie Children's has also been ranked among the best in the nation in a U S News & World Report opinion-based survey of top pediatrichospitals for the past three years Lurie Children's is home to the world's first pediatric center for Autonomic Medicine and was the first pediatric hospital in Illinois toperform the Berlin Heart procedure , a breakthrough technology that helps children awaiting heart transplants In the fiscal year ending August 31, 2012, LurieChildren's, through nearly 602 , 580 patient visits, served more than 149,450 children who came from all over the State of Illinois and beyond to access the morethan 70 specialties offered by Lurie Children ' s During this period there were 480,563 outpatient visits including 319,350 visits in Lincoln Park including 6,760observation cases, 61,767 emergency room visits and 99,446 outpatient visits at the satellite facilities Lurie Children ' s is the largest provider of Medicaid services toIllinois children In total, during the State of Illinois' fiscal year 2012 , Lurie Children ' s provided approximately 57% more outpatient and inpatient Medicaid servicesthan the next highest Illinois hospital Lurie Children's pediatric - specialist physicians provide more specialty care to children insured by the State of Illinois' Medicaidprogram than any other specialty care provider Lurie Children's maintains a charity care policy under which it provides healthcare services free of charge or at agreatly reduced rate to children whose families are unable to pay for the charges associated with their medical care For the fiscal year ended August 31, 2012, thetotal unreimbursed care and community benefit ( as reported in the FY 2012 audit of Lurie Children's and its affiliates ) provided by Lurie Children's and its affiliateswas approximately $ 118 million, including $ 76 9 million in costs associated with unreimbursed services provided by Lurie Children's and its affiliated physician groupsto children on Medicaid and $42 3 million for charity care and other community benefit including , but not limited to, resident and fellow expenses $ 15 3 million,research funding $7 1 million, operation of a community clinic support $ 2 9 million, child advocacy programs $5 5 million and the provision of language assistance,pastoral care , social work , art and music therapies , hospital volunteer services, transplant family housing and other family support services $6 5 million LurieChildren's undertakes a broad range of services and activities in addition to patient care that support its charitable mission Lurie Children's functions as a teachingand research institution whose efforts have contributed considerably to improvements in the quality of life and healthcare for children Lurie Children ' s supportscommunity medical needs through a variety of outreach programs and educational programs In December 2001, Lurie Children's became the first pediatric hospitalin the nation and the first hospital in Illinois to receive the Magnet Award from the American Nurses Credentialing Center Lurie Children's was awarded thisdesignation again in 2005 and 2010 Today , while the status is the most sought - after nation - wide honor in hospital nursing , fewer than 1% of hospitals haveachieved the accomplishment of maintaining the designation three or more times Lurie Children's is one of the major pediatric teaching hospitals in the U S ,serving as the pediatric teaching facility and the primary pediatric practice site of Northwestern University's Feinberg School of Medicine ("NUFSM") for residentphysicians , fellows and medical students in pediatric specialties and sub - specialties This program is consistently one of the most sought after in the country Inacademic year 2011 - 2012, over 926 individuals applied for the 31 available pediatric resident positions Lurie Children's has 198 pediatric residents and fellows invarious pediatric training programs from NUFSM for which Lurie Children's serves as the primary site Lurie Children ' s also offers clinical experiences in pediatrics tomedical students , nursing students , and students in other allied health fields Lurie Children's is affiliated with 19 nursing education programs In academic year2011 - 2012, there were 1,117 student placements , including 315 third and fourth year medical students , 502 nursing students, and 300 allied health students LurieChildren's has completed construction of a new, 288-licensed bed , acute care, pediatric hospital which is named the "Ann & Robert H Lurie Children ' s Hospital ofChicago" to replace its old hospital facilities This new facility which opened June 9, 2012, is in close proximity to NUFSM and will facilitate Lurie Children's ability tocontinue to build upon its academic and research ties in a family - centered environment and state - of-the - art pediatric care facility that will foster the provision ofcompassionate care Lurie Children's role as a regional referral center for a variety of pediatric diseases and illnesses has created many research opportunities tostudy and treat them and Lurie Children ' s research arm, Ann & Robert H Lurie Children's Hospital of Chicago Research Center, ( Lurie Children's Research Center) isone of the nation's few centers dedicated solely to pediatric research See the tax information return of Lurie Children ' s affiliate, Lurie Children's Research Center(EIN #36 -3357005) Alone, or in conjunction with other community partners, Lurie Children's provides programs to support the health and well - being of children inour local community and beyond involving patient care and prevention , research , education and advocacy Much of Lurie Children's community work is in schools,particularly for children with special health and learning needs and the capacities of school personnel serving them In the past 18 years, Lurie Children's has servedmore than 20,000 children and faculty of the Chicago Public Schools to enhance the health and safety programs and accommodations of chronically ill childrenPrograms address specific conditions such as epilepsy , ADHD, HIV infection , and impaired hearing Other programs educate personnel about advanced medicaltechnologies and aiding children transitioning from Lurie Children's setting back to school Other community health activities include a partnership by Hospitalhematologists with the American Red Cross Blood Services to launch a cooperative sickle cell blood donor program to increase the number of blood donations byAfrican Americans to help children with sickle cell disease who require frequent blood transfusions Lurie Children ' s is a driving member of the Consortium to LowerObesity in Chicago Children (CLOCC) to confront childhood obesity in Chicago CLOCC is currently working with the City of Chicago to promote healthy eating andphysical activity and is also piloting programs in Englewood , Humboldt Park, Lower West Side, Rogers Park West Garfield Park , and West Town neighborhoods inChicago Lurie Children's operates an Injury Prevention and Research Center to educate and to improve public policy and foster protective environments , in additionto coordinating injury prevention initiatives at Lurie Children's Lurie Children ' s also has developed programs to teach children sports injury prevention LurieChildren's participates in a community partnership to create a one-stop center to coordinate medical, social and housing services for Chicago's most vulnerableyouth The Broadway Youth Center addresses the unique medical and psychological needs of youth who are homeless , those at risk for HIV, and young people whoare lesbian , gay, bisexual or transgender Lurie Children ' s offers a summer internship for Latino high school students to introduce them to promising career opp

4b (Code ) (Expenses $ including grants of $ ) (Revenue $

4c (Code ) (Expenses $ including grants of $ ) (Revenue $

4d Other program services (Describe in Schedule 0 )

(Expenses $ including grants of $ ) (Revenue $

4e Total program service expenses-$ 5 21,011,3 9 5

Form 990 (2011 )

Form 990 (2011)

Checklist of Required Schedules

Yes No

1 Is the organization described in section 501(c)(3) or4947(a)(1) (other than a private foundation)? If "Yes," Yes

complete Schedule As . . . . . . . . . . . . . . . . . . . 1

2 Is the organization required to complete Schedule B, Schedule of Contnbutors(see instructions)? IN . 2 Yes

3 Did the organization engage in direct or indirect political campaign activities on behalf of or in opposition to No

candidates for public office? If "Yes,"complete Schedule C, Part Is . . . . . . . . .

4 Section 501 ( c)(3) organizations . Did the organization engage in lobbying activities, or have a section 501(h) Yes

election in effect during the tax year? If "Yes "complete Schedule C Part II . . . . . . . . . 4, ,

5 Is the organization a section 501 (c)(4), 501 (c)(5), or 501(c)(6) organization that receives membership dues,assessments, or similar amounts as defined in Revenue Procedure 98-19? If "Yes," completeSchedu/e C, Part III

.S 5 No

6 Did the organization maintain any donor advised funds or any similar funds or accounts for which donors have theright to provide advice on the distribution or investment of amounts in such funds or accounts? If "Yes,"complete

Schedule D, Part ID . . . . . . . . . . . . . . . . . . . 6N o

7 Did the organization receive or hold a conservation easement, including easements to preserve open space,

the environment, historic land areas or historic structures? If "Yes,"complete Schedule D, Part 1195 7 No

8 Did the organization maintain collections of works of art, historical treasures, or other similar assets? If "Yes,"N o

complete Schedule D, Part III . . . . . . . . . . . . . . . . . . . . 8

9 Did the organization report an amount in Part X, line 21, serve as a custodian for amounts not listed in Part X, orprovide credit counseling, debt management, credit repair, or debt negotiation services? If "Yes,"

complete Schedule D, Part IV' . . . . . . . . . . . . . . . . . . 9 N o

10 Did the organization, directly or through a related organization, hold assets in temporarily restricted endowments, 10 Yespermanent endowments, or quasi-endowments? If "Yes,"complete Schedule D, Part V

11 If the organization's answer to any of the following questions is 'Yes/then complete Schedule D, Parts VI, VII,VIII, IX, or X as applicable

a Did the organization report an amount for land, buildings, and equipment in Part X, linel0? If "Yes,"completeYes

Schedule D, Part VI. lla

b Did the organization report an amount for investments-other securities in Part X, line 12 that is 5% or more ofYes

its total assets reported in Part X, line 16? If "Yes," complete Schedule D, Part VII. llb

c Did the organization report an amount for investments-program related in Part X, line 13 that is 5% or more of

INo

its total assets reported in Part X, line 16? If "Yes," complete Schedule D, Part VIII.IN 11c

d Did the organization report an amount for other assets in Part X, line 15 that is 5% or more of its total assetsNo

reported in Part X, line 16? If "Yes," complete Schedule D, Part IX. lid

e Did the organization report an amount for other liabilities in Part X, line 25? If "Yes," complete Schedule D, Part X.Yeslie

f Did the organization's separate or consolidated financial statements for the tax year include a footnote thataddresses the organization's liability for uncertain tax positions under FIN 48 (ASC 740)? If "Yes,"complete 11f NoSchedule D, Part X.9

12a Did the organization obtain separate, independent audited financial statements for the tax year? If "Yes,"complete )

Schedule D, Parts XI, XII, and XIII 95 12a N o

b Was the organization included in consolidated, independent audited financial statements for the tax year? If"Yes,"and if the organization answered 'No'to line 12a, then completing Schedule D, Parts XI, XII, and XIII is optional 12b Yes

13 Is the organization a school described in section 170(b)(1)(A)(ii)? If "Yes, "complete Schedule E13 No

14a Did the organization maintain an office, employees, or agents outside of the United States? . 14a No

b Did the organization have aggregate revenues or expenses of more than $10,000 from grantmaking, fundraising, business, investment,

and program service activities outside the United States, or aggregate foreign investments valued at $100,000 or more? if "Yes, " complete

Schedule F, Part I . 14b Yes

15 Did the organization report on Part IX, column (A), line 3, more than $5,000 of grants or assistance to any

organization or entity located outside the U S ? If "Yes," complete Schedule F, Part II and IV . 15 No

16 Did the organization report on Part IX, column (A), line 3, more than $5,000 of aggregate grants or assistance to

individuals located outside the U S ? If "Yes," complete Schedule F, Part III and IV . 16 No

17 Did the organization report a total of more than $15,000, of expenses for professional fundraising services on 17 NoPart IX, column (A), lines 6 and 11e? If "Yes," complete Schedule G, PartI

18 Did the organization report more than $15,000 total of fundraising event gross income and contributions on PartVIII, lines 1c and 8a? If "Yes," complete Schedule G, Part II . . . . . . . . . 18 No

19 Did the organization report more than $15,000 of gross income from gaming activities on Part VIII, line 9a? If 19 No"Yes,"complete Schedule G, Part III . . . . . . . . . . . . . . . . . . .

20a Did the organization operate one or more hospitals? If "Yes, "complete Schedule H . 20a Yes

b If"Yes" to line 20a, did the organization attach its audited financial statement to this return? Note . All Form 990

filers that operated one or more hospitals must attach audited financial statements 20b Yes

Form 990 (2011)

Form 990 (2011)

Checklist of Required Schedules (continued)

21 Did the organization report more than $5,000 of grants and other assistance to governments and organizations in 21 Yes

the United States on Part IX, column (A), line 1? If "Yes," complete Schedule I, Parts I and II . .

22 Did the organization report more than $5,000 of grants and other assistance to individuals in the United States 22on Part IX, column (A), line 2? If "Yes," complete Schedule I, Parts I and III .

No

23 Did the organization answer "Yes" to Part VII, Section A, questions 3, 4, or 5, about compensation of theorganization's current and former officers, directors, trustees, key employees, and highest compensated 23 Yes

employees? If "Yes,"completeScheduleJ . . . . . . . . . . . . . . . .

24a Did the organization have a tax-exempt bond issue with an outstanding principal amount of more than $100,000as of the last day of the year, that was issued after December 31, 2002? If "Yes," answer questions 24b-24d and

complete Schedule K. If "No,"go to line 25 . . . . . . . . . . . . . . . 24a Yes

b Did the organization invest any proceeds of tax-exempt bonds beyond a temporary period exception? . 24b No

c Did the organization maintain an escrow account other than a refunding escrow at any time during the yearto defease any tax-exempt bonds? . 24c No

d Did the organization act as an "on behalf of" issuer for bonds outstanding at any time during the year? 24d No

25a Section 501(c)( 3) and 501 ( c)(4) organizations . Did the organization engage in an excess benefit transaction with

a disqualified person during the year? If "Yes," complete Schedule L, Part I . 25a No

b Is the organization aware that it engaged in an excess benefit transaction with a disqualified person in a prioryear, and that the transaction has not been reported on any of the organization's prior Forms 990 or 990-EZ? If 25b No

"Yes,"complete Schedule L, Part I . . . . . . . . . . . . . . . 95

26 Was a loan to or by a current or former officer, director, trustee, key employee, highly compensated employee, ordisqualified person outstanding as of the end of the organization's tax year? If "Yes," complete Schedule L, 26 NoPart II . . . . . . . . . . . . . . . . . . . . . . . . . . .

27 Did the organization provide a grant or other assistance to an officer, director, trustee, key employee, substantialcontributor, or a grant selection committee member, or to a person related to such an individual? If "Yes," 27 No

complete Schedule L, Part III . . . . . . . . . . . . . . 19

28 Was the organization a party to a business transaction with one of the following parties? (see Schedule L, Part IVinstructions for applicable filing thresholds, conditions, and exceptions)

a A current or former officer, director, trustee, or key employee? If "Yes,"complete Schedule L, Part

IV . . . . . . . . . . . . . . . . . . . . . . . . . 28a No

b A family member of a current or former officer, director, trustee, or key employee? If "Yes,"

complete Schedule L, Part IV . . . . . . . . . . . . . . . . . . . 28b Yes

c A n entity of which a current or former officer, director, trustee, or key employee (or a family member thereof) was

an officer, director, trustee, or owner? If "Yes," complete Schedule L, Part IV . 28c Yes

29 Did the organization receive more than $25 000 in non-cash contributions? If "Yes "complete Schedule MIN Yes, , 29

30 Did the organization receive contributions of art, historical treasures, or other similar assets, or qualified

conservation contributions? If "Yes, "complete Schedule M . . . . . . . . . . . . 30 No

31 Did the organization liquidate, terminate, or dissolve and cease operations? If "Yes," complete Schedule N,Part I . . . . . . . . . . . . . . . . . . . . . . . . . . 31 N o

32 Did the organization sell, exchange, dispose of, or transfer more than 25% of its net assets? If "Yes, " completeSchedule N, Part II . . . . . . . . . . . . . . . . . . . . . . 32 N o

33 Did the organization own 100% of an entity disregarded as separate from the organization under Regulations

sections 301 7701-2 and 301 7701-3? If "Yes,"complete Schedule R, PartI . . . . . . . . 33 No

34 Was the organization related to any tax-exempt or taxable entity? If "Yes,"complete Schedule R, Parts II, III, IV,

and V, line 1 . . . . . . . . . . . . . . . . . . . . . 34 Yes

35a Is any related organization a controlled entity of the filing organization within the meaning of section 512(b)(13)?35a N o

b Did the organization receive any payment from or engage in any transaction with a controlled entity within the35b No

meaning of section 512(b)(13 )? If "Yes,"complete Schedule R, Part V, line 2 . . .

36 Section 501(c)( 3) organizations . Did the organization make any transfers to an exempt non-charitable related

organization? If "Yes,"complete Schedule R, Part t<, line 2 . . . . . . . . . . . 36 No

37 Did the organization conduct more than 5% of its activities through an entity that is not a related organization

and that is treated as a partnership for federal income tax purposes? If "Yes," complete Schedule R, Part VI 37 No

38 Did the organization complete Schedule 0 and provide explanations in Schedule 0 for Part VI, lines 11 and 19?Note . All Form 990 filers are required to complete Schedule 0 . . . . . . . . . . 38 Yes

Form 990 (2011 )

Form 990 (2011)

KEWStatements Regarding Other IRS Filings and Tax Compliance

Check if Schedule 0 contains a response to any question in this Part V

Yes No

la Enter the number reported in Box 3 of Form 1096 Enter-0- if not applicable

la 321

b Enter the number of Forms W-2G included in line la Enter-0- if not applicablelb 0

c Did the organization comply with backup withholding rules for reportable payments to vendors and reportablegaming (gambling) winnings to prize winners? . . . . . . . . . . . . . . . . . 1c Yes

2a Enter the number of employees reported on Form W-3, Transmittal of Wage and TaxStatements filed for the calendar year ending with or within the year covered by thisreturn . . . . . . . . . . . . . . . . . . . . 2a 4,671

b If at least one is reported on line 2a, did the organization file all required federal employment tax returns?2b Yes

Note . If the sum of lines la and 2a is greater than 250, you may be required to e-file (see instructions)

3a Did the organization have unrelated business gross income of $1,000 or more during theyear? . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3a Yes

b If "Yes," has it filed a Form 990-T for this year? If "No,"provide an explanation in Schedule O . . . . 3b Yes

4a At any time during the calendar year, did the organization have an interest in, or a signature or other authorityover, a financial account in a foreign country (such as a bank account or securitiesaccount)? . . . . . . . . . . . . . . . . . . . . . . 4a No

b If "Yes," enter the name of the foreign country 0-See instructions for filing requirements for Form TD F 90-22 1, Report of Foreign Bank and Financial Accounts

5a Was the organization a party to a prohibited tax shelter transaction at any time during the tax year? . . 5a No

b Did any taxable party notify the organization that it was or is a party to a prohibited tax shelter transaction? 5b No

c If"Yes" to line 5a or 5b, did the organization file Form 8886-T?5c

6a Does the organization have annual gross receipts that are normally greater than $100,000, and did the 6a Noorganization solicit any contributions that were not tax deductible? . .

b If "Yes," did the organization include with every solicitation an express statement that such contributions or giftswere not tax deductible? . . . . . . . . . . . . . . . . . . . . . . . 6b

7 Organizations that may receive deductible contributions under section 170(c).

a Did the organization receive a payment in excess of $75 made partly as a contribution and partly for goods and 7a Noservices provided to the payor? . . . . . . . . . . . . . . . . . . . .

b If "Yes," did the organization notify the donor of the value of the goods or services provided? . 7b

c Did the organization sell, exchange, or otherwise dispose of tangible personal property for which it was required tofile Form 82827 . . . . . . . . . . . . . . . . . . . . . . . . . . 7c No

d If "Yes," indicate the number of Forms 8282 filed during the year . 7d

e Did the organization receive any funds, directly or indirectly, to pay premiums on a personal benefitcontract? . . . . . . . . . . . . . . . . . . . . . . . . . 7e N o

f Did the organization, during the year, pay premiums, directly or indirectly, on a personal benefit contract? 7f No

g If the organization received a contribution of qualified intellectual property, did the organization file Form 8899 asrequired? . 7g

h If the organization received a contribution of cars, boats, airplanes, or other vehicles, did the organization file aForm 1098-C? . 7h

8 Sponsoring organizations maintaining donor advised funds and section 509(a )( 3) supporting organizations. Didthe supporting organization, or a donor advised fund maintained by a sponsoring organization, have excessbusiness holdings at any time during the year? . 8

9 Sponsoring organizations maintaining donor advised funds.

a Did the organization make any taxable distributions under section 4966? . 9a

b Did the organization make a distribution to a donor, donor advisor, or related person? . 9b

10 Section 501(c)( 7) organizations. Enter

a Initiation fees and capital contributions included on Part VIII, line 12 . 10a

b Gross receipts, included on Form 990, Part VIII, line 12, for public use of club 10bfacilities

11 Section 501(c)( 12) organizations. Enter

a Gross income from members or shareholders . . . . . . . . 11a

b Gross income from other sources (Do not net amounts due or paid to othersources against amounts due or received from them ) . . . . . . 11b

12a Section 4947( a)(1) non-exempt charitable trusts. Is the organization filing Form 990 in lieu of Form 1041? 12a

b If "Yes," enter the amount of tax-exempt interest received or accrued during theyear 12b

13 Section 501(c)( 29) qualified nonprofit health insurance issuers.

a Is the organization licensed to issue qualified health plans in more than one state?Note . All 501(c)(29) organizations must list in Schedule 0 each state in which they are licensed to issuequalified health plans, the amount of reserves required by each state, and the amount of reserves the organizationallocated to each state 13a

b Enter the aggregate amount of reserves the organization is required to maintain bythe states in which the organization is licensed to issue qualified health plans 13b

c Enter the aggregate amount of reserves on hand13c

14a Did the organization receive any payments for indoor tanning services during the tax year? . . . 14a No

b If "Yes," has it filed a Form 720 to report these payments? If "No,"provide an explanation in Schedule 0 . 14b

Form 990 (2011 )

Form 990 ( 2011)

Lam Governance , Management, and Disclosure For each "Yes" response to lines 2 through 7b below, and fora "No" response to lines 8a, 8b, or 10b below, describe the circumstances, processes, or changes in Schedule0. See instructions.Check if Schedule 0 contains a response to any question in this Part VI .F

Section A . Governing Body and Management

Yes No

la Enter the number of voting members of the governing body at the end of the taxyear . . . . . . . . . . . . . la 106

b Enter the number of voting members included in line la, above, who areindependent . . . . . . . . . . . . . . . . lb 91

2 Did any officer, director, trustee, or key employee have a family relationship or a business relationship with anyother officer, director, trustee, or key employee? 2 Yes

3 Did the organization delegate control over management duties customarily performed by or under the directsupervision of officers, directors or trustees, or key employees to a management company or other person? . 3 No

4 Did the organization make any significant changes to its governing documents since the prior Form 990 wasfiled? 4 No

5 Did the organization become aware during the year of a significant diversion of the organization's assets? 5 No

6 Did the organization have members or stockholders? 6 Yes

7a Did the organization have members, stockholders, or other persons who had the power to elect or appoint one ormore members of the governing body? . . . . . . . . . . . . . . . . 7a Yes

b Are any governance decisions of the organization reserved to (or subject to approval by) members, stockholders, 7b Yesor persons other than the governing body?

8 Did the organization contemporaneously document the meetings held or written actions undertaken during theyear by the following

a The governing body? . . . . . . . . . . . . . . . . . . . . . . . . 8a Yes

b Each committee with authority to act on behalf of the governing body? . 8b Yes

9 Is there any officer, director, trustee, or key employee listed in Part VII, Section A, who cannot be reached at the

FTorganization's mailing address? If"Yes," provide the names and addresses i n Schedule 0 . . . 9 No

Section B. Policies (This Section B requests information about policies not required by the InternalRevenue Code. )

Yes No

10a Did the organization have local chapters, branches, or affiliates? 10a No

b If"Yes," did the organization have written policies and procedures governing the activities of such chapters,affiliates, and branches to ensure their operations are consistent with the organization's exemptpurposes? . . 10b

11a Has the organization provided a complete copy of this Form 990 to all members of its governing body before filingthe form? 11a No

b Describe in Schedule 0 the process, if any, used by the organization to review the Form 990

12a Did the organization have a written conflict of interest policy? If "No,"go to line 13 . 12a Yes

b Were officers, directors or trustees, and key employees required to disclose annually interests that could giverise to conflicts? . . . . . . . . . . . . . . . . . . . . . . . 12b Yes

c Did the organization regularly and consistently monitor and enforce compliance with the policy? If"Yes," describein Schedule 0 how this was done . . . . . . . . . . . . . . . . . . . 12c Yes

13 Did the organization have a written whistleblower policy? 13 Yes

14 Did the organization have a written document retention and destruction policy? . 14 Yes

15 Did the process for determining compensation of the following persons include a review and approval byindependent persons, comparability data, and contemporaneous substantiation of the deliberation and decision?

a The organization's CEO, Executive Director, or top management official 15a Yes

b Other officers or key employees of the organization 15b Yes

If "Yes," to line 15a or 15b, describe the process in Schedule 0 (see instructions)

16a Did the organization invest in, contribute assets to, or participate in a joint venture or similar arrangement with ataxable entity during the year? . . . . . . . . . . . . . . . . . . . . . 16a No

b If "Yes," did the organization follow a written policy or procedure requiring the organization to evaluate itsparticipation in joint venture arrangements under applicable federal tax law, and take steps to safeguard theorganization's exempt status with respect to such arrangements? 16b

Section C. Disclosure

17 List the States with which a copy of this Form 990 is required to be filed- IL

18 Section 6104 requires an organization to make its Form 1023 (or 1024 if applicable ), 990, and 990 -T (501(c)(3 )s only) available for public inspection Indicate how you made these available Check all that apply

fl Own website fi Another 's website F Upon request

19 Describe in Schedule 0 whether ( and if so, how), the organization made its governing documents , conflict ofinterest policy , and financial statements available to the public See Additional Data Table

20 State the name, physical address, and telephone number of the person who possesses the books and records of the organization 0-

PAULA M NOBLE225 E CHICAGO AVE PR DEPT BOX 26CHICAGO,IL 606112991(312)227-4306

Form 990 (2011 )

Form 990 (2011)

Compensation of Officers , Directors ,Trustees, Key Employees, Highest CompensatedEmployees , and Independent ContractorsCheck if Schedule 0 contains a response to any question in this Part VII .F

Section A. Officers, Directors, Trustees, Kev Employees, and Highest Compensated Employees

la Complete this table for all persons required to be listed Report compensation for the calendar year ending with or within the organization'stax year* List all of the organization's current officers, directors, trustees (whether individuals or organizations), regardless of amountof compensation, and current key employees Enter -0- in columns (D), (E), and (F) if no compensation was paid

* List all of the organization's current key employees, if any See instructions for definition of "key employee "

* List the organization's five current highest compensated employees (other than an officer, director, trustee or key employee)who received reportable compensation (Box 5 of Form W-2 and/or Box 7 of Form 1099-MISC) of more than $100,000 from theorganization and any related organizations

* List all of the organization's former officers, key employees, or highest compensated employees who received more than $100,000of reportable compensation from the organization and any related organizations

* List all of the organization's former directors or trustees that received, in the capacity as a former director or trustee of theorganization, more than $10,000 of reportable compensation from the organization and any related organizations

List persons in the following order individual trustees or directors, institutional trustees, officers, key employees, highestcompensated employees, and former such persons

fl Check this box if neither the organization nor any related organizations compensated any current or former officer, director, or trustee

(A)Name and Title

(B)Averagehoursperweek

(describe

(C)Position (do not checkmore than one box,

unless person is bothan officer and adirector/trustee)

(D)Reportable

compensationfrom the

organization (W-2/1099-MISC)

( E)Reportable

compensationfrom relatedorganizations(W- 2/1099-

(F)Estimated

amount of othercompensation

from theorganization and

hoursfor

relatedorganizations

Schedule0)

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boo

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MISC) relatedorganizations

See Additional Data Table

Form 990 (2011 )

Form 990 (2011)

Section A. Officers, Directors, Trustees , Key Employees, and Highest Compensated Employees (continued)

(A)Name and Title

(B)Averagehoursperweek

(describe

(C)Position (do not checkmore than one box,

unless person is bothan officer and adirector/trustee)

(D)Reportable

compensationfrom the

organization (W-2/1099-MISC)

(E)Reportable

compensationfrom relatedorganizations(W- 2/1099-

(F)Estimated

amount of othercompensation

from theorganization and

hoursfor

relatedorganizations

Schedule0)

LG -

C

'

-

t

t

Qr

5m

D

4

^

iD =

boo

0 'D{7

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lb Sub-Total . . . . . . . . . . . . . . .

c Total from continuation sheets to Part VII, Section A . . .

d Total ( add lines lb and 1c) . 7,954,014 2,088,385 2,736,629

Total number of individuals (including but not limited to those listed above) who received more than$100,000 of reportable compensation from the organization-314

No

Did the organization list any former officer, director or trustee, key employee, or highest compensated employee

on line la? If "Yes," complete Schedule Jfor such individual . . . . . . . . . . . . 3 No

4 For any individual listed on line la, is the sum of reportable compensation and other compensation from theorganization and related organizations greater than $150,0007 If "Yes," complete Schedule -7 for such

individual . . . . . . . . . . . . . . . . . . . . . . . . . . .

Did any person listed on line la receive or accrue compensation from any unrelated organization or individual for

services rendered to the organization? If "Yes,"complete Schedule J for such person . 5 No

Section B. Independent Contractors

1 Complete this table for your five highest compensated independent contractors that received more than$100,000 of compensation from the organization Report compensation for the calendar year ending withor within the organization's tax year

(A) (B) (C)Name and business address Description of services Compensation

MORTENSON POWER25 NW POINT BLVD CONSTRUCTION 115,191,773ELK GROVE VILLAGE, IL 60007

POWER CONSTRUCTION2360 PALMER DRIVE CONSTRUCTION 15,223,065SCHAUMBURG, IL 60173

MCGAW MEDICAL CENTER303 E CHICAGO AVE PROF MED SVCS 14,424,397CHICAGO, IL 60611

CROTHALL HEALTHCARE955 CHESTERBROOK BLVD STE 300 MEDICAL SERVICES 6,128,505WAYNE, PA 19087

CHILDREN'S SURGICAL FOUNDATION225 E CHICAGO AVE PROF MED SVCS 4,943,917CHICAGO, IL 60611

2 Total number of independent contractors (including but not limited to those listed above) who received more than$100,000 of compensation from the organization 0-292

Form 990 (2011 )

Form 990 (2011)

N Statement of Revenue(A) (B) (C) (D)

Total revenue Related or Unrelated Revenueexempt business excluded fromfunction revenue tax underrevenue sections

512, 513, or514

la Federated campaigns . la

b Membership dues . . . . lbC C

c Fundraising events . 1c

45 •Cx^

d Related organizations . ld 5,426,966

e Government grants ( contributions) le

i f All other contributions, gifts, grants , and if 56,344,976similar amounts not included above

g Noncash contributions included ini 1,749,533

lines la-1f $

h Total . Add lines la -1f . 0- 61,771,942

Business Codew

2a Patient Care & Program Services 621110 374,117,972 374,117,972

b Medicare/Medicaid 621110 167,751,320 167,751,320

q C Grants - 621110 39,997,292 39,997,292Fed/State/Agency/Subcontract/Private

U5d Reference Lab Revenue 621500 954,839 932,964 21,875

e Parking Garages 812930 1,314,393 330,163 984,230

f All other program service revenue 2,901,771 1,223,722 1,678,049O

g Total . Add lines 2a -2f . . . . . . . 0- 587,037,587

3 Investment income ( including dividends , interest

and other similar amounts ) 10- 11,641,063 83,089 11,557,974

4 Income from investment of tax- exempt bond proceeds . . 0- 0

5 Royalties . . . . . . . . . . . . 0- 0

(i) Real (ii) Personal

6a Gross rents 3,057,410

b Less rental 488,569expenses

c Rental income 2,568,841or (loss)

d Net rental inco me or ( loss) . 2,568,841 2,690,669 -121,828

(i) Securities (ii) Other

7a Gross amount 195,462,475from sales ofassets otherthan inventory

b Less cost or 173,352,717 158,669other basis andsales expenses

c Gain or (loss) 22,109,758 -158,669

d Net gain or ( loss) . 10- 21,951,089 21,951,089

8a Gross income from fundraisingw events ( not including3 $

of contributions reported on line 1c)See Part IV, line 18 .

aL

b Less direct expenses . b

c Net income or (loss ) from fundraising events . 0

9a Gross income from gaming activitiesSee Part IV, line 19 . .

a

b Less direct expenses . b

c Net income or (loss ) from gaming activities . . .0- 0

10a Gross sales of inventory, lessreturns and allowances .

a

b Less cost of goods sold . b

c Net income or (loss ) from sales of inventory . 0- 0

Miscellaneous Revenue Business Code

11a

b

C

d All other revenue . .

e Total .Add lines 11a-11d . .0- 0

12 Total revenue . See Instructions .684,970,522 586,713,939 , 435,127 , 36,049,514 ,

Form 990 (2011)

Form 990 (2011)

Statement of Functional Expenses

Section 501(c)(3) and 501(c)(4) organizations must complete all columnsAll other organizations must complete column (A) but are not required to complete columns (B), (C), and (D)Check if Schedule 0 contains a response to any question in this Part IX (-

Do not include amounts reported on lines 6b,

7b, 8b, 9b, and 10b of Part VIII .

( A)

Total expenses

(B)Program service

expenses

(C)Management andgeneral expenses

(D)Fundraisingexpenses

1 Grants and other assistance to governments and organizations

in the United States See Part IV, line 2134,793,643 34,793,643

2 Grants and other assistance to individuals in theUnited States See Part IV, line 22 0

3 Grants and other assistance to governments,organizations , and individuals outside the UnitedStates See Part IV, lines 15 and 16 0

4 Benefits paid to or for members 0

5 Compensation of current officers, directors , trustees, and

key employees 7,356,699 1,990,511 5,366,188

6 Compensation not included above, to disqualified persons(as defined under section 4958(f)(1)) and personsdescribed in section 4958( c)(3)(B) . 0

7 Other salaries and wages 233,517,045 201,121,624 32,395,421

8 Pension plan contributions ( include section 401(k) and section403(b) employer contributions ) . 6,025,408 4,809,408 1,216,000

9 Other employee benefits 32,227,243 27,551,233 4,676,010

10 Payroll taxes . . . . . . . . . . 16,829,111 14,697,829 2,131,282

11 Fees for services ( non-employees)

a Management . 0

b Legal 1,024 ,372 1,024,372

c Accounting 1,015,235 1,015,235

d Lobbying 651,745 651,745

e Professional fundraising See Part IV, Tine 17 0

f Investment management fees 4,935,375 4,935,375

g Other 25,640,906 10,223,360 15,417,546

12 Advertising and promotion . 3,720,163 246 3,719,917

13 Office expenses 35,676,429 35,066,129 610,300

14 Information technology 17,696,389 15,057,604 2,638,785

15 Royalties . 0

16 Occupancy 13,413,318 11,570,805 1,842,513

17 Travel 1,030,899 708,532 322,367

18 Payments of travel or entertainment expenses for any federal,state, or local public officials 0

19 Conferences , conventions , and meetings 1,842,696 1,811,991 30,705

20 Interest 4,986,958 4,965,671 21,287

21 Payments to affiliates 0

22 Depreciation , depletion, and amortization 43,127,483 40,613,290 2,514,193

23 Insurance 10,133,672 9,929,776 203,896

24 Other expenses Itemize expenses not covered above (Listmiscellaneous expenses in line 24f If line 24f amount exceeds 10% ofline 25, column ( A) amount, list line 24f expenses on Schedule 0

a MEDICAL SUPPLIES 62,224,875 62,224,748 127

b MEDICAID PROVIDER TAX 13,729,114 13,729,114

c MEDICAL ADMIN &TEACHING 13,718,850 13,718,850

d BAD DEBT PROVISION 5,671,437 5,671,437

e

f All other expenses 14,971,519 10,103,849 4,867,670

25 Total functional expenses. Add lines 1 through 24f 605,960,584 521,011,395 84,949,189 0

26 Joint costs. Check here 1F- if following

SOP 98-2 (ASC 958-720) Complete this line only if theorganization reported in column (B) joint costs from acombined educational campaign and fundraising solicitation

Form 990 (2011)

Form 990 (2011)

Balance Sheet

(A) (B)Beginning of year End of year

1 Cash-non-interest-bearing 0 1 0

2 Savings and temporary cash investments . 148,262,276 2 55,419,829

3 Pledges and grants receivable, net 95,284,016 3 91,471,095

4 Accounts receivable, net . 28,987,889 4 101,880,115

5 Receivables from current and former officers, directors, trustees, key employees, andhighest compensated employees Complete Part II of

Schedule L 0 5 0

6 Receivables from other disqualified persons (as defined under section 4958(f)(1)) andpersons described in section 4958(c)(3)(B) Complete Part II of

Schedule L 0 6 0

7 Notes and loans receivable, net 0 7 0

8 Inventories for sale or use 4,027,088 8 5,866,553

9 Prepaid expenses and deferred charges 6,569,785 9 10,471,266

10a Land, buildings, and equipment cost or other basis Complete 1,373,867,225

Part VI of Schedule D 10a

b Less accumulated depreciation 10b 330,406,874 854,006,811 10c 1 ,043,460,351

11 Investments-publicly traded securities . 572,286,175 11 580,515,235

12 Investments-other securities See Part IV, line 11 290,191,017 12 273,322,979

13 Investments-program-related See Part IV, line 11 . 0 13 0

14 Intangible assets 0 14 0

15 Other assets See Part IV, line 11 42,472,873 15 43,715,171

16 Total assets . Add lines 1 through 15 (must equal line 34) . 2,042,087,930 16 2,206,122,594

17 Accounts payable and accrued expenses 90,876,396 17 132,979,530

18 Grants payable 0 18 0

19 Deferred revenue 0 19 0

20 Tax-exempt bond liabilities 550,882,715 20 496,889,155

21 Escrow or custodial account liability Complete Part IVof Schedule D 0 21 0

22 Payables to current and former officers, directors, trustees, keyemployees, highest compensated employees, and disqualified

persons Complete Part II of Schedule L . 0 22 0

23 Secured mortgages and notes payable to unrelated third parties 0 23 0

24 Unsecured notes and loans payable to unrelated third parties 15,079,468 24 67,098,596

25 Other liabilities (including federal income tax, payables to related third parties,and other liabilities not included on lines 17-24) Complete Part X of ScheduleD . 132,273,382 25 188,067,052

26 Total liabilities . Add lines 17 through 25 . 789,111,961 26 885,034,333

Organizations that follow SFAS 117, check here 1- F and complete lines 27

through 29, and lines 33 and 34.

C5 27 Unrestricted net assets 722,301,893 27 982,985,433

Mca

28 Temporarily restricted net assets 390,048,649 28 195,155,061

r29 Permanently restricted net assets 140,625,427 29 142,947,767

Organizations that do not follow SFAS 117, check here 1- fl and completeW_lines 30 through 34.

30 Capital stock or trust principal, or current funds 30

31 Paid-in or capital surplus, or land, building or equipment fund 31

< 32 Retained earnings, endowment, accumulated income, or other funds 32

33 Total net assets or fund balances 1,252,975,969 33 1,321,088,261

34 Total liabilities and net assets/fund balances 2,042,087,930 34 2,206,122,594

Form 990 (2011 )

Form 990 (2011)

« Reconcilliation of Net AssetsCheck if Schedule 0 contains a response to any question in this Part XI . F

1 Total revenue (must equal Part VIII, column (A), line 12)1 684,970,522

2 Total expenses (must equal Part IX, column (A), line 25)2 605,960,584

3 Revenue less expenses Subtract line 2 from line 1 .3 79,009,938

4 Net assets or fund balances at beginning of year (must equal Part X, line 33, column (A))4 1,252,975,969

5 Other changes in net assets or fund balances (explain in Schedule O) .5 -10,897,646

6 Net assets or fund balances at end of year Combine lines 3, 4, and 5 (must equal Part X, line 33, column(B)) 6 1,321,088,261

GZMM-Financial Statements and Reporting

Check if Schedule 0 contains a response to any question in this Part XII (-

Yes No

Accounting method used to prepare the Form 990 fl Cash 17 Accrual (OtherIf the organization changed its method of accounting from a prior year or checked "Other," explain inSchedule 0

2a Were the organization's financial statements compiled or reviewed by an independent accountant? 2a No

b Were the organization's financial statements audited by an independent accountant? . 2b Yes

c If "Yes," to 2a or 2b, does the organization have a committee that assumes responsibility for oversight of theaudit, review, or compilation of its financial statements and selection of an independent accountant?If the organization changed either its oversight process or selection process during the tax year, explain inSchedule 0 2c Yes

d If "Yes" to line 2a or 2b, check a box below to indicate whether the financial statements for the year were issuedon a separate basis, consolidated basis, or both

fl Separate basis F Consolidated basis fl Both consolidated and separated basis

3a As a result of a federal award, was the organization required to undergo an audit or audits as set forth in theSingle Audit Act and OMB Circular A-133? . . . . . . . . . . . . . . . 3a Yes

b If"Yes," did the organization undergo the required audit or audits? If the organization did not undergo the required 3b Yesaudit or audits, explain why in Schedule 0 and describe any steps taken to undergo such audits .

Form 990 (2011 )


SCHEDULE A Public Charity Status and Public SupportOMB No 1545-0047

(Form 990 or 990EZ) 2011Complete if the organization is a section 501(c)( 3) organization or a sectionDepartment of the Treasury 4947( a)(1) nonexempt charitable trust.

Internal Revenue Service► Attach to Form 990 or Form 990-EZ . ► See separate instructions.

Name of the organization Employer identification numberAnn & Robert H Lurie Children's Hospital ofChicago I 36-2170833

Reason for Public Charity Status (All organizations must complete this part.) See InstructionsThe organization is not a private foundation because it is (For lines 1 through 11, check only one box)

1 1 A church, convention of churches, or association of churches section 170 ( b)(1)(A)(i).

2 1 A school described in section 170(b)(1)(A)(ii). (Attach Schedule E )

3 F A hospital or a cooperative hospital service organization described in section 170 ( b)(1)(A)(iii).

4 1 A medical research organization operated in conjunction with a hospital described in section 170(b)(1)(A)(iii). Enter thehospital's name, city, and state

5 fl An organization operated for the benefit of a college or university owned or operated by a governmental unit described in

section 170 ( b)(1)(A)(iv ). (Complete Part II )

6 fl A federal, state, or local government or governmental unit described in section 170 ( b)(1)(A)(v).

7 1 An organization that normally receives a substantial part of its support from a governmental unit or from the general publicdescribed insection 170 ( b)(1)(A)(vi ) (Complete Part II )

8 fl A community trust described in section 170 ( b)(1)(A)(vi ) (Complete Part II )

9 1 An organization that normally receives (1) more than 331/3% of its support from contributions, membership fees, and gross

receipts from activities related to its exempt functions-subject to certain exceptions, and (2) no more than 331/3% of

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

acquired by the organization after June 30, 1975 See section 509(a)(2). (Complete Part III )

10 fl An organization organized and operated exclusively to test for public safety Seesection 509(a)(4).

11 fl An organization organized and operated exclusively for the benefit of, to perform the functions of, or to carry out the purposes ofone or more publicly supported organizations described in section 509(a)(1) or section 509(a)(2) See section 509(a)(3). Checkthe box that describes the type of supporting organization and complete lines 11e through 11h

a fl Type I b fl Type II c fl Type III - Functionally integrated d fl Type III - Other

e fl By checking this box, I certify that the organization is not controlled directly or indirectly by one or more disqualified personsother than foundation managers and other than one or more publicly supported organizations described in section 509(a)(1 ) orsection 509(a)(2)

f If the organization received a written determination from the IRS that it is a Type I, Type II or Type III supporting organization,check this box F

g Since August 17, 2006, has the organization accepted any gift or contribution from any of thefollowing persons?(i) a person who directly or indirectly controls, either alone or together with persons described in (ii) Yes No

and (iii) below, the governing body of the the supported organization? 11g(i)

(ii) a family member of a person described in (i) above? 11g(ii)

(iii) a 35% controlled entity of a person described in (i) or (ii) above? 11g(iii)

h Provide the following information about the supported organization(s)

0)Name ofsupported

organization

(ii)EIN

(iii)

Type of

organization

(described on

lines 1- 9 above

or IRC section

(see

(iv)Is the

organization incol (i) listed inyour governingdocument?

(v)Did you notify theorganization incol (i) of your

support?

(vi)Is the

organization incol (i) organized

in the U S ?

viiAmount ofsupport?

instructions)) Yes No Yes No Yes No

Total

For Paperwork Reduction Act Notice, seethe Instructions for Form 990 Cat No 11285F Schedule A (Form 990 or 990-EZ) 2011

Schedule A (Form 990 or 990-EZ) 2011 Page 2

Support Schedule for Organizations Described in IRC 170(b )( 1)(A)(iv) and 170(b)(1)(A)(vi)(Complete only if you checked the box on line 5, 7, or 8 of Part I or if the organization failed to qualifyunder Part III. If the organization fails to qualify under the tests listed below, please complete Part III.)

Section A . Public SupportCalendar year (or fiscal year beginning (a) 2007 (b) 2008 (c) 2009 (d) 2010 (e) 2011 (f) Total

in)1 Gifts, grants, contributions, and

membership fees received (Do notinclude any "unusualgrants ")

2 Tax revenues levied for theorganization's benefit and eitherpaid to or expended on itsbehalf

3 The value of services or facilitiesfurnished by a governmental unit tothe organization without charge

4 Total .Add lines 1 through 3

5 The portion of total contributionsby each person (other than agovernmental unit or publiclysupported organization) included online 1 that exceeds 2% of theamount shown on line 11, column(f)

6 Public Support . Subtract line 5 fromline 4

Section B. Total SupportCalendaryear (or fiscal year beginning (a) 2007 (b) 2008 (c) 2009 (d) 2010 (e) 2011 (f) Total

in)

7 Amounts from line 4

8 Gross income from interest,dividends, payments received onsecurities loans, rents, royaltiesand income from similar

10

11

12

13

sourcesNet income from unrelatedbusiness activities, whether ornot the business is regularlycarried onOther income (Explain in PartIV ) Do not include gain or lossfrom the sale of capital assetsTotal support (Add lines 7through 10)Gross receipts from related activities, etc (See instructions 12

First Five Years If the Form 990 is for the organization's first, second, third, fourth, or fifth tax year as a 501(c)(3) organization,check this box and stop here llik^F-

Section C. Computation of Public Support Percentage14 Public Support Percentage for 2011 (line 6 column (f) divided by line 11 column (f)) 14

15 Public Support Percentage for 2010 Schedule A, Part II, line 14 15

16a 331 / 3%support test -2011 . Ifthe organization did not check the box on line 13, and line 14 is 33 1/3% or more, check this boxand stop here . The organization qualifies as a publicly supported organization

b 33 1 / 3%support test -2010 . Ifthe organization did not check the box on line 13 or 16a, and line 15 is 33 1/3% or more, check thisbox and stop here . The organization qualifies as a publicly supported organization

17a 10%-facts-and -circumstances test -2011 . If the organization did not check a box on line 13, 16a, or 16b and line 14is 10% or more, and if the organization meets the "facts and circumstances" test, check this box and stop here . Explainin Part IV how the organization meets the "facts and circumstances" test The organization qualifies as a publicly supportedorganization

b 10%-facts-and-circumstances test -2010 . If the organization did not check a box on line 13, 16a, 16b, or 17a and line15 is 10% or more, and if the organization meets the "facts and circumstances" test, check this box and stop here.Explain in Part IV how the organization meets the "facts and circumstances" test The organization qualifies as a publiclysupported organization

18 Private Foundation If the organization did not check a box on line 13, 16a, 16b, 17a or 17b, check this box and seeinstructions

Schedule A (Form 990 or 990-EZ) 2011


IMMITM Support Schedule for Organizations Described in IRC 509(a)(2)(Complete only if you checked the box on line 9 of Part I or if the organization failed to qualify underPart II. If the organization fails to qualify under the tests listed below, please complete Part II.)

Section A . Public SupportCalendar year (or fiscal year beginning (a) 2007 (b) 2008 (c) 2009 (d) 2010 (e) 2011 (f) Total

in)1 Gifts, grants, contributions, and

membership fees received (Do notinclude any "unusual grants ")

2 Gross receipts from admissions,merchandise sold or servicesperformed, or facilities furnished inany activity that is related to theorganization's tax-exemptpurpose

3 Gross receipts from activities thatare not an unrelated trade orbusiness under section 513

4 Tax revenues levied for theorganization's benefit and eitherpaid to or expended on itsbehalf

5 The value of services or facilitiesfurnished by a governmental unit tothe organization without charge

6 Total . Add lines 1 through 5

7a Amounts included on lines 1, 2,and 3 received from disqualifiedpersons

b Amounts included on lines 2 and 3received from other thandisqualified persons that exceedthe greater of$5,000 or 1% of theamount on line 13 for the year

c Add lines 7a and 7b

8 Public Support (Subtract line 7cfrom line 6 )

Section B. Total SupportCalendar year (or fiscal year beginning (a) 2007 (b) 2008 (c) 2009 (d) 2010 (e) 2011 (f) Total

in)

9 Amounts from line 6

10a Gross income from interest,dividends, payments received onsecurities loans, rents, royaltiesand income from similarsources

b Unrelated business taxableincome (less section 511 taxes)from businesses acquired afterJune 30, 1975

c Add lines 10a and 10b

11 Net income from unrelatedbusiness activities not includedin line 10b, whether or not thebusiness is regularly carried on

12 Other income Do not includegain or loss from the sale ofcapital assets (Explain in PartIV )

13 Total support (Add lines 9, 10c,11 and 12)

14 First Five Years If the Form 990 is for the organization's first, second, third, fourth, or fifth tax year as a 501(c)(3) organization,check this box and stop here

Section C. Com p utation of Public Support Percenta g e15 Public Support Percentage for 2011 (line 8 column (f) divided by line 13 column (f)) 15

16 Public support percentage from 2010 Schedule A, Part III, line 15 16

Section D . Computation of Investment Income Percentage

17 Investment income percentage for 2011 (line 10c column (f) divided by line 13 column (f)) 17

18 Investment income percentage from 2010 Schedule A, Part III, line 17 18

19a 33 1/3%support tests-2011 . If the organization did not check the box on line 14, and line 15 is more than 33 1/3% and line 17 is notmore than 33 1/3%, check this box and stop here . The organization qualifies as a publicly supported organization

b 33 1 / 3% support tests-2010 . If the organization did not check a box on line 14 or line 19a, and line 16 is more than 33 1/3% and line18 is not more than 33 1/3%, check this box and stop here . The organization qualifies as a publicly supported organization

20 Private Foundation If the organization did not check a box on line 14, 19a or 19b, check this box and see instructions



Supplemental Information . Supplemental Information. Complete this part to provide the explanationrequired by Part II, line 10; Part II, line 17a or 17b; or Part III, line 12. Also complete this part for anyadditional information. (See instructions).

Facts And Circumstances Test

Explanation



SCHEDULE C Political Campaign and Lobbying Activities OMB No 1545-0047

(Form 990 or 990-EZ)For Organizations Exempt From Income Tax Under section 501(c) and section 527 2011

Department of the Treasury 1- Complete if the organization is described below.

Internal Revenue Service 1- Attach to Form 990 or Form 990-EZ. 1- See separate instructions . • • - ' •

If the organization answered "Yes," to Form 990, Part IV , Line 3 , or Form 990-EZ , Part V, line 46 (Political Campaign Activities),then• Section 501(c)(3) organizations Complete Parts I-A and B Do not complete Part I-C• Section 501(c) (other than section 501(c)(3)) organizations Complete Parts I-A and C below Do not complete Part I-B• Section 527 organizations Complete Part I-A onlyIf the organization answered "Yes," to Form 990, Part IV , Line 4 , or Form 990-EZ, Part VI, line 47 (Lobbying Activities), then• Section 501(c)(3) organizations that have filed Form 5768 (election under section 501(h)) Complete Part II-A Do not complete Part II-B• Section 501(c)(3) organizations that have NOT filed Form 5768 (election under section 501(h)) Complete Part II-B Do not complete Part II-AIf the organization answered "Yes," to Form 990, Part IV, Line 5 (Proxy Tax) or Form 990-EZ , line 35c (Proxy Tax), then* Section 501(c)(4), (5), or (6) organizations Complete Part IIIName of the organization Employer identification numberAnn & Robert H Lurie Children's Hospital ofChicago 36-2170833

Complete if the organization is exempt under section 501(c) or is a section 527 organization.

1 Provide a description of the organization's direct and indirect political campaign activities on behalf of orin opposition to candidates for public office in Part IV

2 Political expenditures - $

3 Volunteer hours

Complete if the organization is exempt under section 501 ( c)(3).

1 Enter the amount of any excise tax incurred by the organization under section 4955 - $

2 Enter the amount of any excise tax incurred by organization managers under section 4955 - $

3 If the organization incurred a section 4955 tax, did it file Form 4720 for this year? fl Yes fl No

4a Was a correction made? fl Yes fl No

b If "Yes," describe in Part IV

rMWINT-Complete if the organization is exempt under section 501 ( c) except section 501 ( c)(3).

1 Enter the amount directly expended by the filing organization for section 527 exempt function activities - $

2 Enter the amount of the filing organization's funds contributed to other organizations for section 527exempt funtion activities - $

3 Total exempt function expenditures Add lines 1 and 2 Enter here and on Form 1120-PO L, line 17b - $

4 Did the filing organization file Form 1120-POL for this year? fl Yes fl No

5 Enter the names, addresses and employer identification number (EIN) of all section 527 political organizations to which the filingorganization made payments For each organization listed, enter the amount paid from the filing organization's funds Also enter theamount of political contributions received that were promptly and directly delivered to a separate political organization, such as aseparate segregated fund or a political action committee (PAC) If additional space is needed, provide information in Part IV

(a) Name (b) Address (c) EIN (d ) Amount paid fromfiling organization's

funds If none, enter -0-

(e) Amount of politicalcontributions received

and promptly anddirectly delivered to a

separate politicalorganization If none,

enter -0-

i-or Privacy Act ana raperworK rteauction Act Notice, see the instructions Tor corm 99U. Cat No 50084S Schedule C ( Form 990 or 990 - EZ) 2011

Schedule C (Form 990 or 990-EZ) 2011 Page 2

Complete if the organization is exempt under section 501(c)(3) and filed Form 5768 (electionunder section 501(h)).

A Check 1 if the filing organization belongs to an affiliated group (and list in Part IV each affiliated group member's name, address, EIN,expenses, and share of excess lobbying expenditures)

B Check 1 if the filing organization checked box A and "limited control" provisions apply

Limits on Lobbying Expenditures(a) Filing (b) Affiliated

(The term "expenditures" means amounts paid or incurred .)O rganization's Group

Totals Totals

la Total lobbying expenditures to influence public opinion (grass roots lobbying)

b Total lobbying expenditures to influence a legislative body (direct lobbying)

c Total lobbying expenditures (add lines la and 1b)

d Other exempt purpose expenditures

e Total exempt purpose expenditures (add lines 1c and 1d)

f Lobbying nontaxable amount Enter the amount from the following table in bothcolumns

If the amount on line le, column ( a) or (b) is:

Not over $500,000

The lobbying nontaxable amount is:

20% of the amount on line le

Over $500,000 but not over $1,000,000 $100,000 plus 15% of the excess over $500,000

Over $1,000,000 but not over $1,500,000 $175,000 plus 10% of the excess over $1,000,000

Over $1,500,000 but not over $17,000,000 $225,000 plus 5% of the excess over $1,500,000

Over $17,000,000 $1,000,000

g Grassroots nontaxable amount (enter 25% of line 1f)

h Subtract line 1g from line la If zero or less, enter-0-

i Subtract line 1f from line 1c If zero or less, enter-0-

i If there is an amount other than zero on either line 1h or line 11, did the organization file Form 4720 reportingsection 4911 tax for this year? Yes No

4-Year Averaging Period Under Section 501(h)

(Some organizations that made a section 501 ( h) election do not have to complete all of the fivecolumns below. See the instructions for lines 2a through 2f on page 4.)

Lobbying Expenditures During 4-Year Averaging Period

Calendar year ( orfiscaI yearbeginning in)

(a) 2008 (b) 2009 (c) 2010 (d) 2011 (e) Total

2a Lobbying non-taxable amount

b Lobbying ceiling amount150% of line 2a column e

c Total lobbying expenditures

d Grassroots non-taxable amount

e Grassroots ceiling amount(150% of line 2d, column (e))

f Grassroots lobbying expenditures

Schedule C (Form 990 or 990-EZ) 2011

Schedule C (Form 990 or 990-EZ) 2011 Page 3

Complete if the organization is exempt under section 501(c)(3) and has NOT filed Form 5768( election under section 501 ( h )) .

(a) (b)

Yes No Amount

1 During the year, did the filing organization attempt to influence foreign, national, state or locallegislation, including any attempt to influence public opinion on a legislative matter or referendum,through the use of

a Volunteers? Yes

b Paid staff or management (include compensation in expenses reported on lines 1c through 1i)? Yes

c Media advertisements? No

d Mailings to members, legislators, or the public? Yes 187

e Publications, or published or broadcast statements? No

f Grants to other organizations for lobbying purposes? No

g Direct contact with legislators, their staffs, government officials, or a legislative body? Yes 546,198

h Rallies, demonstrations, seminars, conventions, speeches, lectures, or any similar means? No

i Other activities? If "Yes," describe in Part IV Yes 105,360

j Total lines 1c through 11 651,745

2a Did the activities in line 1 cause the organization to be not described in section 501(c)(3)? No

b If "Yes," enter the amount of any tax incurred under section 4912

c If "Yes," enter the amount of any tax incurred by organization managers under section 4912

d If the filing organization incurred a section 4912 tax, did it file Form 4720 for this year?

Complete if the organization is exempt under section 501 ( c)(4), section 501(c )( 5), or section501 ( c )( 6 ) .

Yes No

1 Were substantially all (90% or more) dues received nondeductible by members? 1

2 Did the organization make only in-house lobbying expenditures of $2,000 or less? 2

3 Did the organization agree to carryover lobbying and political expenditures from the prior year? 3

Complete if the organization is exempt under section 501(c)(4), section 501(c )( 5), or section

501(c )( 6) if BOTH Part 111-A , lines 1 and 2 are answered "No" OR if Part 111 - A, line 3 isanswered "Yes".

1 Dues, assessments and similar amounts from members 1

2 Section 162(e) non-deductible lobbying and political expenditures (do not include amounts of politicalexpenses for which the section 527(f ) tax was paid).

a Current year 2a

b Carryover from last year 2b

c Total 2c

3 Aggregate amount reported in section 6033(e)(1 )(A) notices of nondeductible section 162(e) dues 3

4 If notices were sent and the amount on line 2c exceeds the amount on line 3, what portion of the excessdoes the organization agree to carryover to the reasonable estimate of nondeductible lobbying andpolitical expenditure next year? 4

5 Taxable amount of lobbying and political expenditures (see instructions) 5

Su lementalInformation

Complete this part to provide the descriptions required for Part I-A, line 1, Part I-B, line 4, Part I-C, line 5, and Part II-B, line 11Also , com p lete this p art for any additional information

Identifier Return Reference Explanation

SUPPLEMENTAL INFORMATION 2011 FORM 990 SCHEDULE C To further their collective mission, Ann & Robert H LurieChildren's Hospital of Chicago ("Lurie Children's") and itsaffiliates, by virtue of their role in providing complex care andcare for children, partner with and frequently interact withmembers of the government in developing policies applicable tochildren's health and well-being In 1994, Lurie Children'sestablished a Public Policy Committee of the Board of Directorsto recommend institutional positions on legislation andregulation that would enable Lurie Children's and its affiliates toenhance the health and well-being of children Over the yearsthe Public Policy Committee has recommended positions onpublic policy matters affecting children's health and well-beingand to garner government funding to support the exemptactivities of Lurie Children's and its affiliates and for thedevelopment and construction of a new hospital which replacedthe old facility of Lurie Children's This new facility facilitatesLurie Children's ability to continue to build upon its academicand research ties in a family-centered environment and state-of-the-art facility that will foster the provision of compassionatecare Examples of policy initiatives for which Lurie Children'shas advocated include preventing transmission of HIV frommothers to newborns, prevention of childhood injury, preventionof child abuse, and prevention of childhood obesity, andimproving access to health insurance for children Read moreabout our current institutional public positions athttp //luriechildrens org/en-us/ways-to-get-involved/cause-in-action/ partnering-with-government-community-leaders/government- relations/pol icy -priorities-positions/Pages/default aspx In addition, when state andfederal legislators or committees need experts to analyze andtestify as to how a pending bill would affect children's health inIllinois, they often look to Lurie Children's and its affiliates Inrecent years, employees, officers and physicians of LurieChildren's and its affiliates have testified before elected officialsand government policymakers in Washington, DC, Springfieldand Chicago on issues ranging from the benefits of childrenpassenger safety and helmet laws to the prevention ofconcussions in youth, funding for graduate medical educationand Medicaid reform In addition, Lurie Children's engages inlobbying activities to seek appropriate Medicaid funding of thesubstantial services provided by Lurie Children's and itsaffiliates to Medicaid-eligible patients in Illinois LurieChildren's also seeks funding, on a state and federal level, forvarious initiatives that will enhance patient care O n the federallevel, Lurie Children's, in connection with other children'steaching hospitals, works to protect and enhance funding for theMedicaid program and graduate medical education for 55freestanding children's teaching hospitals in the United States

Schedule C (Form 990 or 990EZ) 2011

lefile GRAPHIC print - DO NOT PROCESS I As Filed Data - I DLN: 934931920072431

SCHEDULE D(Form 990) Supplemental Financial Statements

1- Complete if the organization answered "Yes," to Form 990,

OMB No 1545-0047

2011Department of the Treasury Part IV, line 6, 7, 9, 10, 11a 11b 11c 11d 11e 11f 12a , or 12b

bafffimInternal Revenue Service 1- Attach to Form 990. 1- See separate instructions.

Name of the organization Employer identification numberAnn & Robert H Lurie Children ' s Hospital ofChicago 36 -2170833

Organizations Maintaining Donor Advised Funds or Other Similar Funds or Accounts. Complete if theorg anization answered "Yes" to Form 990 Part IV , line 6.

(a) Donor advised funds (b) Funds and other accounts

1 Total number at end of year

2 Aggregate contributions to (during year)

3 Aggregate grants from ( during year)

4 Aggregate value at end of year

5 Did the organization inform all donors and donor advisors in writing that the assets held in donor advisedfunds are the organization ' s property , subject to the organization ' s exclusive legal control? F Yes I No

6 Did the organization inform all grantees , donors, and donor advisors in writing that grant funds may beused only for charitable purposes and not for the benefit of the donor or donor advisor, or for any other purposeconferring impermissible private benefit fl Yes fl No

MRSTI-Conservation Easements . Complete if the organization answered "Yes" to Form 990, Part IV, line 7.

1 Purpose ( s) of conservation easements held by the organization ( check all that apply)

1 Preservation of land for public use (e g , recreation or pleasure ) 1 Preservation of an historically importantly land area

1 Protection of natural habitat 1 Preservation of a certified historic structure

fl Preservation of open space

Complete lines 2a-2d if the organization held a qualified conservation contribution in the form of a conservationeasement on the last day of the tax year

Held at the End of the Year

a Total number of conservation easements 2a

b Total acreage restricted by conservation easements 2b

c Number of conservation easements on a certified historic structure included in (a) 2c

d Number of conservation easements included in (c) acquired after 8/17/06 2d

N umber of conservation easements modified, transferred, released, extinguished, or terminated by the organization during

the taxable year 0-

4 N umber of states where property subject to conservation easement is located 0-

5 Does the organization have a written policy regarding the periodic monitoring, inspection , handling of violations, andenforcement of the conservation easements it holds? fl Yes fl No

Staff and volunteer hours devoted to monitoring, inspecting and enforcing conservation easements during the year 1-

Amount of expenses incurred in monitoring, inspecting, and enforcing conservation easements during the year

0-$Does each conservation easement reported on line 2 ( d) above satisfy the requirements of section170(h)(4)(B)(i) and 170(h)(4)(B)(ii)? 1 Yes fl No

9 In Part XIV, describe how the organization reports conservation easements in its revenue and expense statement, andbalance sheet, and include, if applicable, the text of the footnote to the organization's financial statements that describesthe organization's accounting for conservation easements

Organizations Maintaining Collections of Art, Historical Treasures, or Other Similar Assets.Complete if the organization answered "Yes" to Form 990, Part IV, line 8.

la If the organization elected, as permitted under SFAS 116, not to report in its revenue statement and balance sheet works ofart, historical treasures, or other similar assets held for public exhibition, education or research in furtherance of public service,provide, in Part XIV, the text of the footnote to its financial statements that describes these items

b If the organization elected, as permitted under SFAS 116, to report in its revenue statement and balance sheet works of art,historical treasures, or other similar assets held for public exhibition, education, or research in furtherance of public service,provide the following amounts relating to these items

(i) Revenues included in Form 990, Part VIII, line 1 $

(ii)Assets included in Form 990, Part X $

If the organization received or held works of art, historical treasures, or other similar assets for financial gain, provide thefollowing amounts required to be reported under SFAS 116 relating to these items

a Revenues included in Form 990, Part VIII, line 1 $

b Assets included in Form 990, Part X $

For Privacy Act and Paperwork Reduction Act Notice, see the Intructions for Form 990 Cat No 52283D Schedule D (Form 990) 2011

Schedule D (Form 990) 2011 Page 2

r:FTnFW Organizations Maintaining Collections of Art, Historical Treasures , or Other Similar Assets (continued)

3 Using the organization's accession and other records, check any of the following that are a significant use of its collectionitems (check all that apply)

a F_ Public exhibition d fl Loan or exchange programs

b 1 Scholarly research e (- Other

c F Preservation for future generations

4 Provide a description of the organization's collections and explain how they further the organization's exempt purpose inPart XIV

5 During the year, did the organization solicit or receive donations of art, historical treasures or other similarassets to be sold to raise funds rather than to be maintained as part of the organization's collection? 1 Yes 1 No

Escrow and Custodial Arrangements . Complete if the organization answered "Yes" to Form 990,Part IV, line 9, or reported an amount on Form 990, Part X, line 21.

la Is the organization an agent, trustee, custodian or other intermediary for contributions or other assets notincluded on Form 990, Part X7 1 Yes F No

b If "Yes," explain the arrangement in Part XIV and complete the following table

Amount

c Beginning balance 1c

d Additions during the year ld

e Distributions during the year le

f Ending balance if

2a Did the organization include an amount on Form 990, Part X, line 21? fl Yes fl No

b If"Yes," explain the arrangement in Part XIV

MITIT-Endowment Funds . Com p lete if the org anization answered "Yes" to Form 990, Part IV , line 10.

la Beginning of year balance .

b Contributions

c Investment earnings or losses

d Grants or scholarships . .

e Other expenditures for facilitiesand programs

f Administrative expenses

g End of year balance .

(a)Current Year ( b)Prior Year (c)Two Years Back (d)Three Years Back (e)Four Years Back

373,934,512 355,075,654 345,631,973 376,042,568

1,354,036 4,592,742 3,257,533 323,812

15,030,547 21,332,401 10,720,980 - 18,808,632

8,001,784 7,066,285 1,635,773 11, 500, 978

2,137,281 2,899,059 424,797

380,180,030 373,934,512 355,075,654 345,631,973

2 Provide the estimated percentage of the yearend balance held as

a Board designated or quasi-endowment 0- 46 220 %

b Permanent endowment 0- 37 600 %

c Term endowment 0- 16 180 %

3a Are there endowment funds not in the possession of the organization that are held and administered for theorganization by Yes No

(i) unrelated organizations . . . . . . . . . . . . . . . . . . . . . . . . 3a(i) No

(ii) related organizations . . . . . . . . . . . . . . . . . . . . . . 3a(ii) No

b If "Yes" to 3a(ii), are the related organizations listed as required on Schedule R? . . I 3b

4 Describe in Part XIV the intended uses of the organization's endowment funds

ITTMvi d Land . Buildinas . and Eauioment. See Form 990. Part X. line 10.

Description of property(a) Cost or otherbasis (investment )

(b)Cost or otherbasis (other )

(c) Accumulateddepreciation

( d) Book value

la Land 39,289,353 39,289,353

b Buildings 1 ,051,919,681 217,816,108 834,103,573

c Leasehold improvements 20,458,431 7,705,555 12,752,876

d Equipment 250,774,296 104,885,211 145,889,085

e Other 11 ,425,464 11,425,464

Total . Add lines la -le (Column (d) should equal Form 990, Part X, column (B), line 10 (c).) . . 0- 1,043,460,351

Schedule D (Form 990) 2011

Schedule D ( Form 990 ) 2011 Page 3

Investments-Other Securities . See Form 990 , Part X , line 12.

(a) Description of security or category ( b)Book value( c) Method of valuation

(including name of security ) Cost or end-of-year market value

(1 )Financial derivatives

(2)Closely-held equity interests

(3)Other(A)ALTERNATIVE INVESTMENTS 273,322,979 F

Total . (Column (b) should equal Form 990, Part X, col (B) line 12) 01 1 2 7 3,3 2 2,9 7 9

Investments- Pro ram Related . See Form 990 , Part X , line 13.

I I(b) Book value

(c) Method of valuation(a) Description of investment type

Cost or end-of-year market value

Total . (Column (b) should equal Form 990, Part X, col (B) line 13 ) 01 1

Other Assets . See Form 990 , Part X line 15.

(a) DescriDtion ( b) Book value

Total . (Column (b) should equal Form 990, Part X, co/.(8) line 15.)

Other Liabilities . See Form 990 , Part X line 25.

1 (a) Description of Liability (b) Amount

Federal Income Taxes 0

SELF INSURANCE LIABILITY 102,770,342

DUE TO THIRD PARTIES 11,054,513

ACCRUED PENSION LIABILITY 60,138,618

ASSET RETIREMENT COSTS 3,503,656

LEASE OBLIGATIONS 10.599.923

Total . (Column (b) should equal Form 990, Part X, col (B) line 25) P. I 18 8,0 6 7,0 5 2

2. Fin 48 (ASC 740) Footnote In Part XIV, provide the text of the footnote to the organization's financial statements that reports theorganization's liability for uncertain tax positions under FIN 48 (ASC740)


Schedule D (Form 990) 2011 Page 4

« Reconciliation of Chang e in Net Assets from Form 990 to Financial Statements

1 Total revenue (Form 990, Part VIII, column (A), line 12) 1

2 Total expenses (Form 990, Part IX, column (A), line 25) 2

3 Excess or (deficit) for the year Subtract line 2 from line 1 3

4 Net unrealized gains (losses) on investments 4

5 Donated services and use of facilities 5

6 Investment expenses 6

7 Prior period adjustments 7

8 Other (Describe in Part XIV) 8

9 Total adjustments (net) Add lines 4 - 8 9

10 Excess or (deficit) for the year per financial statements Combine lines 3 and 9 10

« Reconciliation of Revenue per Audited Financial Statements With Revenue per Return

1 Total revenue, gains, and other support per audited financial statements . 1

2 Amounts included on line 1 but not on Form 990, Part VIII, line 12

a Net unrealized gains on investments . 2a

b Donated services and use of facilities . 2b

c Recoveries of prior year grants 2c

d Other (Describe in Part XIV) . . . . . . . . . . . 2d

e Add lines 2a through 2d . . . . . . . . . . . . . . . . . . . . 2e

3 Subtract line 2e from line 1 . . . . . . . . . . . . . . . . . . . . 3

4 Amounts included on Form 990, Part VIII, line 12, but not on line 1

a Investment expenses not included on Form 990, Part VIII, line 7b . 4a

b Other (Describe in Part XIV) . . . . . . . . . . 4b

c Add lines 4a and 4b . . . . . . . . . . . . . . . . . . . . . . 4c

5 Total Revenue Add lines 3 and 4c. (This should equal Form 990, Part I, line 12 . . . . . 5

« Reconciliation of Expenses per Audited Financial Statements With Expenses per Return

1 Total expenses and losses per audited financialstatements . 1

2 Amounts included on line 1 but not on Form 990, Part IX, line 25

a Donated services and use of facilities . 2a

b Prior year adjustments 2b

c Other losses . . . . . . . . . . . . . . . 2c

d Other (Describe in Part XIV) . . . . . . . . . . . 2d

e Add lines 2a through 2d . . . . . . . . . . . . . . . . . . . . . 2e

3 Subtract line 2e from line 1 . . . . . . . . . . . . . . . . . . . . 3

4 Amounts included on Form 990, Part IX, line 25, but not on line 1:

a Investment expenses not included on Form 990, Part VIII, line 7b 4a

b Other (Describe in Part XIV) . . . . . . . . . . . 4b

c Add lines 4a and 4b . . . . . . . . . . . . . . . . . . . . . . 4c

5 Total expenses Add lines 3 and 4c. (This should equal Form 990, Part I, line 18 . . . . . 5

« Sumilemental information

Complete this part to provide the descriptions required for Part II, lines 3, 5, and 9, Part III, lines la and 4, Part IV, lines lb and 2b,Part V, line 4, Part X, Part XI, line 8, Part XII, lines 2d and 4b, and Part XIII, lines 2d and 4b Also complete this part to provide anyadditional information


INTENDED USES OF ENDOWMENT Schedule D, Part V, Line 4 Lurie Children's endowment fund consists of individual donor-FUNDS restricted endowment funds and funds designated by its Board to

function as endowments The net assets associated withendowment funds, including those funds designated by the Boardto function as endowments, are classified and reported based onthe existence or absence of donor-imposed restrictionsEffective June 30, 2009, Illinois passed Uniform PrudentManagement of Institutional Funds Act ("UPMIFA") LurieChildren's has, after obtaining advice of outside counsel,interpreted UPMIFA as sustaining the preservation of theoriginal gift as of the gift date of the donor-restricted endowmentfunds absent explicit donor stipulations to the contrary As aresult of this interpretation, Lurie Children's classifies aspermanently restricted net assets, (a) the original value of giftsdonated to the permanent endowment, (b) the original value ofsubsequent gifts to the permanent endowment, and (c)accumulations to the permanent endowment made in accordancewith the direction of the applicable donor gift instrument at thetime the accumulation is added to the fund The remainingportion of the donor-restricted endowment fund that is notclassified in permanently restricted net assets is classified astemporarily restricted net assets until those amounts areappropriated for expenditure by Lurie Children's in a mannerconsistent with the donor intent and standard of prudenceprescribed by UPMIFA Where the Board designatesunrestricted funds to function as endowments they are classifiedas unrestricted net assets



SCHEDULE F Statement of Activities Outside the United StatesOMB No 1545-0047

(Form 990) 2011n Complete if the organization answered " Yes" to Form 990,

Part IV, line 14b, 15, or 16.

Department of the Treasury n Attach to Form 990 . ► See separate instructions.Open to Public

Internal Revenue Service Inspection

Name of the organization Employer identification numberAnn & Robert H Lurie Children's Hospital ofChicago 36-2170833

General Information on Activities Outside the United States . Complete if the organization answered"Yes" to Form 990, Part IV, line 14b.

1 For grantmakers . Does the organization maintain records to substantiate the amount of the grants or

assistance, the grantees' eligibility for the grants or assistance, and the selection criteria used to award

the grants or assistance? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F Yes fl No

2 For grantmakers . Describe in Part V the organization's procedures for monitoring the use of grant funds outside theUnited States

3 Activites per Region (Use Part V if additional space is needed )

(a) Region (b) Number ofoffices in the

region

(c) Number ofemployees or

agents in region orindependentcontractors

(d) Activities conducted inregion (by type) (e g ,fundraising, program

services, investments, grantsto recipients located in the

reg ion)

(e) If activity listed in (d) is aprogram service, describe

specific type ofservice(s) in region

(f) Totalexpenditures for

region/ investmentsin region

Sub-Saharan Africa Program Services MEDICAL 45,000

Europe (Including Iceland andGreenland)

Investments 69,775,950

East Asia and the Pacific Investments 816,572

Central America and theCaribbean

Investments 48,724,928

3a Sub-total 119 , 3 6 2450

b Total from continuation sheetsto Part I

c Totals (add lines 3a and 3b) 119,362,450

For Privacy Act and Paperwork Reduction Act Notice, see the Instructions for Form 990 . Cat No 50082W Schedule F (Form 990) 2011

Schedule F (Form 990) 2011 Page 2

Grants and Other Assistance to Organizations or Entities Outside the United States . Complete if the organization answered "Yes" to Form 990,Part IV, line 15, for any recipient who received more than $5,000. Check this box if no one recipient received more than $5,000 . . . . . . . . ► FUse Part V if additional space is needed.

1(a) Name oforganization

(b) IRS codesection

and EIN (ifapplicable)

( c) Region ( d) Purpose ofgrant

(e) Amount ofcash grant

(f) Manner ofcash

disbursement

(g) Amount ofof non-cashassistance

(h) Descriptionof non-cashassistance

(i) Method ofvaluation

(book, FMV,appraisal, other)

Enter total number of recipient organizations listed above that are recognized as charities by the foreign country, recognized astax-exempt by the IRS, or for which the grantee or counsel has provided a section 501(c)(3) equivalency letter . . . . .

Enter total number of other organizations or entities .

Schedule F (Form 990) 2011


Grants and Other Assistance to Individuals Outside the United States . Complete if the organization answered "Yes" to Form 990, Part IV, line 16.Use Part V if additional space is needed.

(a) Type of grant orassistance

(b) Region ( c) Number ofrecipients

( d) Amount ofcash grant

(e) Manner of cashdisbursement

(f) Amount ofnon-cashassistance

(g) Descriptionof non-cashassistance

( h) Method ofvaluation

(book, FMV,a pp raisal , other )



Foreign Forms

1 Was the organization a U S transferor of property to a foreign corporation during the tax year? If "Yes," theorganization may be required to file Form 926 (see instructions for Form 926)

2 Did the organization have an interest in a foreign trust during the tax year? If "Yes," the organization may berequired to file Form 3520 and/or Form 3520-A. (see instructions for Forms 3520 and 3520-A)

3 Did the organization have an ownership interest in a foreign corporation during the tax year? If "Yes," theorganization may be required to file Form 5471, Information Return of U.S. Persons with respect to Certain ForeignCorporations. (see instructions for Form 5471)

4 Was the organization a direct or indirect shareholder of a passive foreign investment company or a qualifiedelecting fund during the tax year? If "Yes,"the organization may be required to file Form 8621, Return by aShareholder of a Passive Foreign Investment Company or Qualified Electing Fund. (see instructions for Form 8621)

5 Did the organization have an ownership interest in a foreign partnership during the tax year? If "Yes," theorganization may be required to file Form 8865, Return of U.S. Persons with respect to Certain Foreign Partnerships.(see instructions for Form 8865)

6 Did the organization have any operations in or related to any boycotting countries during the tax year? If "Yes,"the organization may be required to file Form 5713, International Boycott Report (see instructions for Form5713).

F Yes F- No

F- Yes F No

F Yes F- No

F Yes F- No

F Yes F- No

F- Yes F No



Supplemental InformationComplete this part to provide the information (see instructions) required in Part I, line 2, and any additionalinformation.

Identifier ReturnReference

Explanation

Organization's Schedule F, Travel grants of $2,500 are provided to third year medical residents that travel to the BugandoProcedures for Monitoring Part V Medical Center in the united republic of Tanzania to provide medical care on a volunteer basis TheUse of Grant Funds travel grants are intended to cover some of the costs related to travel to and from the unitedOutside the US republic of Tanzania, as well as housing and meals while at the Bugando Medical Center The

medical residents are provided $1,250 prior to their departure and $1,250 upon their return to theUS


l efile GRAPHIC print - DO NOT PROCESS As Filed Data - DLN: 93493192007243

SCHEDULE H HospitalsOMB No 1545-0047

(Form 990) 20111- Complete if the organization answered "Yes" to Form 990, Part IV , question 20.Department of the Treasury 1- Attach to Form 990. 1- See separate instructions. OpenInternal Revenue Service Inspection


i

la Did the organization have a charity care policy? If "No," skip to question 6a

b If "Yes," is it a written policy? . .

2 If the organization had multiple hospitals, indicate which of the following best describes application of the charitycare policy to the various hospitals

F Applied uniformly to all hospitals F Applied uniformly to most hospitals

F Generally tailored to individual hospitals

3 Answer the following based on the charity care eligibility criteria that applies to the largest number of theorganization ' s patients during the tax year

a Did the organization use Federal Poverty Guidelines ( FPG) to determine eligibility for providing free care?

If "Yes," indicate which of the following is the FPG family income limit for eligibility for free care

F 100% F 150% F 200% I_ Other 300.%

b Did the organization use FPG to determine eligibility for providing discounted care? If

"Yes," indicate which of the following is the family income limit for eligibility for discounted care

F 200% F 250% F 300% F 350% F 400% F Other %

c If the organization did not use FPG to determine eligibility, describe in Part VI the income based criteria fordetermining eligibility for free or discounted care Include in the description whether the organization uses an assettest or other threshold, regardless of income, to determine eligibility for free or discounted care

4 Did the organization's policy provide free or discounted care to the "medically indigent"?

5a Did the organization budget amounts for free or discounted care provided under its financial assistance policy duringthe tax year?

b If "Yes," did the organization's charity care expenses exceed the budgeted amount? . .

c If "Yes" to line 5b, as a result of budget considerations, was the organization unable to provide free or discountedcare to a patient who was eligibile for free or discounted care? .

6a Did the organization prepare a community benefit reportduring the tax year?

6b If "Yes," did the organization make it available to the public?

Complete the following table using the worksheets provided in the Schedule H instructions Do not submit theseworksheets with the Schedule H

Yes

la Yes

lb Yes

3a I Yes

No

3b Yes

4 Yes

5a Yes

5b N o

5c

6a Yes

6b Yes

7 Charity Care and Certain Other Community Benefits at Cost

Charity Care and (a) Number of (b) Persons (c) Total community (d) Direct offsetting (e) Net community benefit (f) Percent of

Means-Testedactivities or served benefit expense revenue expense total expense

Government Programsprograms(optional)

(optional)

a Charity care at cost (fromWorksheet 1) . . . 0 1,051,901 0 1,051,901 0 180 %

b Medicaid (from Worksheet 3,column a) 0 236,599,110 182,903,717 53,695,394 8 940 %

c Costs of other means-testedgovernment programs (fromWorksheet 3, column b) 0 0 0 0 0

d Total Charity Care andMeans-Tested GovernmentPrograms 0 237,651,011 182,903,717 54,747,295 9 120

Other Benefitse Community health improvement

services and communitybenefit operations (from(Worksheet 4) . . . 0 12,190,250 0 12,190,250 2 030

f Health professions education(from Worksheet 5) . 0 15,185,384 2,800,752 12,384,632 2 060

g Subsidized health services(from Worksheet 6) 0 790,365 0 790,365 0 130

h Research (from Worksheet 7) 0 61,827,263 11,371,416 50,455,847 8 410

i Cash and in-kind contributionsfor community benefit (fromWorksheet 8) . . . . 0 12,303,002 0 12,303,002 2 050

j Total Other Benefits . . . 0 102,296,264 14,172,168 88,124,096 14 680 %

k Total . Add lines 7d and 7j 0 339,947,275 , 197,075,885 , 142,871,391 , 23 800 %

For Privacy Act and Paperwork Reduction Act Noticee see the Instructions for Form 990 . Cat N o 50192T Schedule H (Form 990) 2011

Schedule H (Form 990) 2011 Page 2

Community Building Activities Complete this table if the organization conducted any community buildingactivities.

(a) Number ofactivities orprograms(optional)

(b) Personsserved (optional)

(c) Total communitybuilding expense

(d) Direct offsettingrevenue

(e) Net communitybuilding expense

(f) Percent oftotal expense

1 Physical improvements and housing

2 Economic develo p ment

3 Community support

4 Environmental im p rovements

5 Leadership development and trainingfor community members

6 Coalition building

7 Community health improvementadvocacy

8 Workforce development

9 Other

10 Total

Bad Debt, Medicare, & Collection Practices

Section A. Bad Debt Expense Yes No

1 Did the organization report bad debt expense in accordance with Heathcare Financial Management AssociationStatement No 15? . . . . . . . . . . . . . . . . . . . . 1 No

2 Enter the amount of the organization's bad debt expense . 2 1,939,320

3 Enter the estimated amount of the organization's bad debt expense attributable topatients eligible under the organization's charity care policy . 3 0

4 Provide in Part VI the text of the footnote to the organization's financial statements that describes bad debt expenseIn addition, describe the costing methodology used in determining the amounts reported on lines 2 and 3, andrationale for including a portion of bad debt amounts as community benefit

Section B. Medicare

5 Entertotal revenue received from Medicare (including DSH and IME) . 5 3,635,303

6 Enter Medicare allowable costs of care relating to payments on line 5 . 6 3,358,986

7 Subtract line 6 from line 5 This is the surplus or (shortfall) . 7 276,317

8 Describe in Part VI the extent to which any shortfall reported in line 7 should be treated as community benefitAlso describe in Part VI the costing methodology or source used to determine the amount reported on line 6Check the box that describes the method used

r- Cost accounting system I' Cost to charge ratio F Other

Section C . Collection Practices

9a Did the organization have a written debt collection policy during the tax year? . 9a Yes

b If "Yes," did the organization's collection policy that applied to the largest number of its patients during the tax yearcontain provisions on the collection practices to be followed for patients who are known to qualify for financialassistance? Describe in Part VI 9b Yes

Management Comeanies and Joint Ventures (see instructions)

(a) Name of entity (b) Description of primaryactivity of entity

(c) Organization'sprofit % or stockownership %

(d) Officers, directors,trustees, or key

employees' profit %or stock ownership%

(e) Physicians'profit % or stockownership

1

2

3

4

5

6

7

8

9

10

11

12

13

Schedule H (Form 990) 2011


Facility Information

Section A . Hospital Facilities

list in order of size from largest to smallest)

ow many hospital facilities did the organization operate duringthe tax year? 1

ame and address

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er (Describe)

1 LURIE CHILDREN'S225 E CHICAGO AVE PR DEPT BOX 26CHICAGO IL 606112991

X X X X X



Facility Information (continued)Section B. Facility Policies and Practices.(Complete a separate Section B for each of the hospital facilities listed in Part V, Section A)

LURIE CHILDREN'S

Name of Hospital Facility:

Line Number of Hospital Facility (from Schedule H, Part V, Section A): 1

Community Health Needs Assessment (Lines 1 through 7 are optional for 2011

1 During the tax year or any prior tax year, did the hospital facility conduct a community health needs assessment("Needs Assessment")? If "No," skip to question 8 . . . . . . . . . . . . . . . . . . . . .

If"Yes," indicate what the Needs Assessment describes (check all that apply)

a F A definition of the community served by the hospital facility

b F Demographics of the community

Existing health care facilities and resources within the community that are available to respond to the healthc

needs of the community

d F How data was obtained

e F The health needs of the community

f F Primary and chronic disease needs and other health issues of uninsured persons, low-income persons, and

minority groups

g F The process for identifying and prioritizing community health needs and services to meet those needs

h F The process for consulting with persons representing the community's interests

i F Information gaps that limit the hospital facility's ability to assess the community's health needs

j F Other (describe in Part VI)

2 Indicate the tax year the hospital facility last conducted a Needs Assessment 20 _

3 In conducting its most recent Needs Assessment, did the hospital facility take into account input from persons whorepresent the community served by the hospital facility? If "Yes," describe in Part VI how the hospital facility took intoaccount input from persons who represent the community, and identify the persons the hospital facility consulted 3

4 Was the hospital facility's Needs Assessment conducted with one or more other hospital facilities? If"Yes," list theother hospital facilities in Part VI . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

5 Did the hospital facility make its Needs Assessment widely available to the public? . . . . . . . . . . .

If"Yes," indicate how the Needs Assessment was made widely available (check all that apply)

a 1 Hospital facility's website

b 1 Available upon request from the hospital facility

c 1 Other (describe in Part VI)

6 If the hospital facility addressed needs identified in its most recently conducted Needs Assessment, indicate how(check all that apply)

a F Adoption of an implementation strategy to address the health needs of the hospital facility's community

b F Execution of the implementation strategy

c F Development of a community-wide community benefit plan for the facility

d F Participation in community-wide community benefit plan

e F Inclusion of a community benefit section in operational plans

f F Adoption of a budget for provision of services that address the needs identified in the CHNA

g F Prioritization of health needs in the community

h F Prioritization of services that the hospital facility will undertake to meet health needs in its community

i F Other (describe in Part VI)

7 Did the hospital facility address all of the needs identified in its most recently conducted Needs Assessment? If"No,"

Financial Assistance Policy

Yes I No

Did the hospital facility have in place during the tax year a written financial assistance policy that

8 Explains eligibility criteria for financial assistance, and whether such assistance includes free or discounted care? 8 Yes

9 Used federal poverty guidelines (FPG) to determine eligibility for providing free care? . . . . . . . . . . . 9 Yes

If "Yes," indicate the FPG family income limit for eligibility for free care 300 %If "No," explain in Part VI the criteria the hospital facility used



Facility information (continued)

10 Used FPG to determine eligibility for providing discounted care? . . . . . . . . . . .

If"Yes," indicate the FPG family income limit for eligibility for discounted care 400 0/0If "No," explain in Part VI the criteria the hospital facility used

11 Explained the basis for calculating amounts charged to patients? . . . . . . . . . . .

If"Yes," indicate the factors used in determining such amounts (check all that apply)

a I Income level

b I Asset level

c I Medical indigency

d I Insurance status

e 1 Uninsured discount

f I Medicaid/Medicare

g 1 State regulation

h 1 Other (describe in Part VI)

12 Explained the method for applying for financial assistance? . . . . . . . . . . . . .

13 Included measures to publicize the policy within the community served by the hospital facility?

If"Yes," indicate how the hospital facility publicized the policy (check all that apply)

a F The policy was posted at all times on the hospital facility's web site

b I The policy was attached to all billing invoices

c I The policy was posted in the hospital facility's emergency rooms or waiting rooms

d I The policy was posted in the hospital facility's admissions offices

e F The policy was provided, in writing, to patients upon admission to the hospital facility

f F' The policy was available upon request

g F' Other (describe in Part VI)

Yes No

10 Yes

. . 1 11 I Yes

. . . . 12 Yes

. . . . 13 Yes

Billing and Collections

14 Did the hospital facility have in place during the tax year a separate billing and collections policy, or a written financialassistance policy (FAP) that explained actions the hospital facility may take upon non-payment? . . . . . . . 14 Yes

15 Check all of the following collection actions against an individual that were permitted under the hospital facility'spolicies during the tax year before making reasonable efforts to determine the patient's eligibility under the facility'sFA P

a 1 Reporting to credit agency

b I' Lawsuits

c 1 Liens on residences

d 1 Body attachments or arrests

e FO ther similar actions (describe in Part VI)

16 Did the hospital facility or an authorized third party perform any of the following actions during the tax year beforemaking reasonable efforts to determine the patient's eligibility under the facility's FAP? . . . . . . . . . . 16 No

If"Yes," check all actions in which the hospital facility or a third party engaged

a 1 Reporting to credit agency

b I' Lawsuits

c 1 Liens on residences

d 1 Body attachments

e FO ther similar actions (describe in Part VI)

17 Indicate which efforts the hospital facility made before initiating any of the actions checked in question 16 (check allthat apply)

a 1' Notified patients of the financial assistance policy upon admission

b 1' Notified patients of the financial assistance policy prior to discharge

c F' Notified patients of the financial assistance policy in communications with the patients regarding the patients'

bills

d F' Documented its determination of whether patients were eligible for financial assistance under the hospital

facility's financial assistance policy

e ' Other (describe in Part VI)



Facility Information (continued)

Policy Relating to Emergency Medical Care

No

18 Did the hospital facility have in place during the tax year a written policy relating to emergency medical care thatrequires the hospital facility to provide, without discrimination, care for emergency medical conditions to individualsregardless of their eligibility under the hospital facility's financial assistance policy? . . . . . . . . . . 18 Yes

If"No," indicate why

a 1 The hospital facility did not provide care for any emergency medical conditions

b 1 The hospital facility's policy was not in writing

c 1 The hospital facility limited who was eligible to receive care for emergency medical conditions (describe in Part

VI)

d 1 Other(describe in Part VI)

Individuals Eligible for Financial Assistance

19 Indicate how the hospital facility determined, during the tax year, the maximum amounts that can be charged to FA P-eligible individuals for emergency or other medically necessary care

a 1 The hospital facility used its lowest negotiated commercial insurance rate when calculating the maximum

amounts that can be charged

b 1 The hospital facility used the average of its three lowest negotiated commercial insurance rates when calculating

the maximum amounts that can be charged

c 1 The hospital facility used the Medicare rates when calculating the maximum amounts that can be charged

d 1 Other (describe in Part VI)

20 Did the hospital facility charge any of its patients who were eligible for assistance under the hospital facility's financialassistance policy, and to whom the hospital facility provided emergency or other medically necessary services, morethan the amounts generally billed to individuals who had insurance covering such care? . . . . . . . . . 20 No

If"Yes," explain in Part VI

21 Did the hospital facility charge any of its FAP-eligible patients an amount equal to the gross charge for servicesprovided to that patient?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 No

If"Yes," explain in Part VI



Facility Information (continued)

Section C. Other Facilities That Are Not Licensed , Registered , or Similarly Recognized as a Hospital Facility(list in order of size from largest to smallest)

How many non-hospital facilities did the organization operate during the tax year? 9

Name and addressLurie Children 's OTP Ctr in Lincoln Park2515 N Clark Street /467 W DemingChicago,IL 60614

Type of Facil

Outpatient Medical Services

Describe

Lurie Children 's OTP Ctr in Westchester Outpatient Medical & Ambulatory Surgical Services2301 Enterprise DrWestchester,IL 60154

Lurie Children 's OTP Ctr in Glenview Outpatient Medical Services2150 Pfingsten RdGlenview,IL 60025

Lurie Children's OTP Ctr in Westbrook OutPATIENT MEDICAL SERVICES11301 W Cermak RdWestchester,IL 60154

Lurie Children's OTP CTR in Arlington Ht Outpatient Medical Services880 W Central Rd Suite 6400

Lurie Children's OTP Ctr in New Lenox Outpatient Medical Services1870 N Silver Cross Blvd Ste 100NewLenox,IL 60451

Lurie Children's OTP Ctr in Winfield OUtpatient Medical services25 N WINFIELD ROADWinfield,IL 60190

Lurie Children 's OTP Ctr in Lake Forest Outpatient Medical Services900 N Westmoreland Suite 209Lake Forest ,IL 60045

Lurie Children ' s Pediatrics - Uptown Outpatient Medical Services4867 N Broadway AvenueChicaao.IL 60640

10



Supplemental Information

Complete this part to provide the following information

1 Required descriptions. Provide the descriptions required for Part I, lines 3c, 6a, and 7, Part II, Part III, lines 4, 8, and 9b, and PartV, Section B, lines 1j, 3, 4, 5c, 6i, 7, 9, 10, 11h, 13g, 15e, 16e, 17e, 18d, 19d, 20, and 21

2 Community health needs assessment . Describe how the organization assesses the health care needs of the communities it serves,in addition to any community health needs assessments reported in Part V, Section B

3 Patient education of eligibility for assistance . Describe how the organization informs and educates patients and persons who maybe billed for patient care about their eligibility for assistance under federal, state, or local government programs or under theorganization's financial assistance policy

4 Community information . Describe the community the organization serves, taking into account the geographic area and demographicconstituents it serves

5 Promotion of community health . Provide any other information important to describing how the organization's hospital facilities orother health care facilities further its exempt purpose by promoting the health of the community (e g , open medical staff, communityboard, use of surplus funds, etc )

6 Affiliated health care system . If the organization is part of an affiliated health care system, describe the respective roles of theorganization and its affiliates in promoting the health of the communities served

7 State filing of community benefit report . If applicable, identify all states with which the organization, or a related organization, filesa community benefit report

Identifier ReturnReference Explanation

Part I, Line 3c N/A Part I, line 6a Lurie Children's prepares an annual communitybenefit report The report can be found athttp //www luriechildrens org/AnnualReport/ The calculation for"charity care and certain other community benefits at cost"reflects the Form 990 definitions and will not necessarilycorrespond to calculations prepared for similar state of Illinoisrep orting requirements and our audited financial statementreporting, each of which may requi re the use of specifiedmethodologies that may differ from Form 990 Part I, line 7gSubs idized health services reported in Section I Line 7g includedetails from two different co mmunity benefit programs of LurieChildren's, namely the Uptown Primary Care and DentistryClinics The operating costs attributable to Primary Care andDentistry clinic are $790,3 65 Both programs are operateddespite financial losses to the organization The clinics p rovidehealthcare to a largely underserved community Part I, line 7,column (f) Total ex pense from Form 990, Part IX, Line 25,column (A) was $605,960,584 The bad debt expense i ncludedin this amount was $5,671,438 Therefore, a total expense of$600,289,146 was used for purposes of calculating Form 990,Schedule H, line 7, column (f) Part I, Line 7 Cos t to chargeratio is calculated using the total expense reflected in the FY2012 audited financial statements reduced by communitybenefits reflected on Schedule H, bad debt, prove der tax, andnon-patient related activity expenses found in the LurieChildren's cost repo rt divided by gross patient charges Part IIN/A Part III, line 4 Lurie Children's defin es self-pay as baddebt when a family is not eligible for financial assistance and isunwi Iling or unable to pay an outstanding account balance Themost common patient bad debt sc enarios include unpaid self-pay portions of account balances after insurance or third part yassistance payments or unpaid account balances after abankruptcy filing Lurie Children 's is sensitive to the financialhealth of our patients and their families and recognizes thatfamily financial concerns may not always be shared At times, apatient may be reluct ant to complete a financial assessment todetermine their eligibility for charity care It is possible thatbecause of these circumstances, a portion of bad debt expensecould represent patients that are unable to pay and might qualifyfor financial assistance, however, accurate data to estimate thisamount is unavailable Lurie Children's is committed to mapaging collection efforts in a sensitive and respectful manner Inthis regard, Lurie Chil dren's sends a minimum of fourletters/statements to the families before taking further ac tionFor high balance accounts, the Hospital will attempt to contactthe patient/family b y telephone Should the Hospital receive noreply, the self-pay balances are sent to a col lection agency forfurther action With few exceptions, Lurie Children's does notcredit I ist its patients or take court action in its attempts tocollect the outstanding balances The allowance for uncollectibleaccounts at the amount of charges written off (net of contractuals and discounts) is presented as a separate line item onthe face of the financial statements Bad debt expense on PartIII Line 2 of Schedule H is calculated based on agin g accountsreceivable and applying historical bad debt percentages PartIII, line 8 N/A Part III, line 9b Collection policies are the samefor all Lurie Children's patients If at any point in the collectionprocess, documentation is received that indicates the patie nt ispotentially eligible for financial assistance but has not applied forit, the accoun t is referred back for a financial assistance reviewhrough the use of pamphlets, signag e and web site notice,

patients and families are notified of Lurie Children's financial assistance policy O n receipt of the information, we will determineeligibility for financia I assistance and notify the patient asquickly as possible Lurie Children's does not purs ue collectionof amounts from patients who are being reviewed for financialassistance eli gibility or who are determined to qualify forfinancial assistance In addition, all patie nts having difficultypaying their bills are directed to financial counselors Our financial counselors will work with our patients to qualify them forfinancial assistance or gove rnment payors such as MedicaidAfter it is determined that a patient meets the qualificat ions forthe financial assistance program, the account balance is eitherpartially or enti rely written off in accordance with our financialassistance policy If there is any remai ning balance, only thatbalance would be subject to our debt collection policy If a patient has requested and/or filled out a financial aid application, alldebt collection active ties stop until eligibility for financialassistance can be determined Our policy provide s that once wehave received the necessary documen



Part I, Line 3c N/A tation we will not refer any accounts for collection until we candetermine whether the pa tient is eligible for financialassistance




Part V Line 13g In an effort to make our patients, families and the broadercommunity aware of Lurie Child ren's financial assistanceprogram, Lurie Children's has taken a number of steps to widelypublicize this policy including * Posting of legible signage inheavily trafficked patie nt areas such as admitting, emergencydepartment and ambulatory registration areas, *Provi dingpamphlets and brochures during the admission and/or dischargeprocess, *Providing not ice of availability of free or discountedcare and other forms of communications, *Offerin g patient andfamily counseling sessions with registrars, patient accountingstaff, or fin ancial counselors either before, during or after thetime of service, as appropriate, and * Providing informationregarding the Hospital's Financial Assistance policy on theHospita Is website Part V Line 19d In calculating theamounts generally billed (AGB), Lurie Chi Idren's has selectedthe "look-back" method whereby the AGB is determined basedon actual past claims paid to Lurie Children's by Medicare fee-for-service together with all private health insurers payingclaims to the Hospital The AGB percentage will be calculatedat I east annually by dividing the sum of all claims that havebeen paid in full during the pri or 12 month period by the sum ofthe gross charges for those claims This resulting percen tages then applied to an individual's gross charges to reduce thebill A revised percen tage will be calculated and applied by the45th day after the first day of the start of th e fiscal year usedto determine the calculations Part VI Line 2 Needsssessment While L urie Children's is in the process of

conducting the formal community health needs assessme ntrequired under 501(r) of the Internal Revenue Code and hasestablished a committee to review the health needs of thecommunity and develop a community health needs assessmentre port, Lurie Children's has utilized other mechanisms toassess the health care needs ofth e larger and diversecommunity it serves in a variety of ways Community needs aredentif ied by the Lurie Children's board of directors as well asseveral advisory boards which are comprised of individualsfrom the community served who are active members of thecommune ty and attuned to community needs For example,Lurie Children's has a very active Family Advisory Board whichthe Hospital relies upon to assist in making decisions aboutprogramm ing and policies Family Advisory Board members,comprised of parents of children who have had extensivenpatient and outpatient experiences at the Hospital, adviseadministration and medical leadership on patient needs andHospital priorities from the family perspecti ve Family AdvisoryBoard Members contribute through participation in planning,operating and policy committees of Lurie Children's Similarly,the Kids' Advisory Board is intended to give a voice to childrenwho have been treated at the Hospital The Kids' Advisory Board makes recommendations on issues related to patient carefrom the perspective of a child , teenager and sibling of apatient The Hospital also has established a Communitydvisor y Board for patients/caregivers of HIV-infected

children, HIV-infected health care workers and other interestedpeople in the community This advisory board seeks input andfeedbac k regarding clinic operations and patient needs tomprove services and research for all H IV-affected patients atLurie Children's The Community Advisory Board meets todiscuss im provements for the program's services, help inmplementing new pediatric, adolescent and perinatal research,review HIV education materials used in the community, and toassess th e effectiveness of the Lurie Children's HIV/AIDSprogram The Hospital also has establishe d an adolescentcommunity advisory board established to address similarssues, specific t o teens with HIV/AIDS Moreover, LurieChildren's has strong relationships with other not- for-profitorganizations (such as health clinics and social serviceagencies) and communit y leaders who help identify existingcommunity needs and ways to address such needs LurieChildren's is also a leader in pediatric research aimed atadvancements in the prevention , diagnosis and treatment ofdiseases that affect the development of children through adolescence as well as adult disorders that derive from them Ann &Robert H Lurie Children's Hospital of Chicago Research Center("Lurie Children's Research Center") is one of a few institutionsn the U S dedicated exclusively to pediatric research Thisresearch aids i n the identification of unmet needs faced by thecommunity and, in particular, the childre n Lurie Children's isprivileged to serve Lurie Children's assesses pediatric healthneed s in the community through its Child Health Data Lab,which provides current and accurate data on the health ofchildren and adolescents throughout Illinois in a readilyunderstand able format By analyzing health status in particu




Part V Line 13g ar areas over periods of time, the data lab assists policy-makers and public health plann ers to identify the healthpromotion and disease and injury prevention needs in localcomm unities in Illinois The data lab publishes reportsncluding detailed analyses of child a nd adolescent injury,death and hospitalization in Illinois by county, and child injuryan d well-being by Chicago community area The data labprovides statistical analysis and pro poses solutions to addressthe leading causes of injury for different age groups The dataab also houses the Illinois health survey which is the firstbroad-based survey of Illin ois youth and adults, designed toprovide county-level estimates of a broad range of healt hconditions for Illinois youth and adults and is intended to guidehealth policy in Illin ois Based upon all these variedassessments, Lurie Children's, in concert with others in thecommunity, strives to address identified needs which it ispositioned to assist with, particularly those related to the healthand well-being of children, through education, re search andpatient care programs, in keeping with its primary mission as atax-exempt enti ty For specific examples of community buildingactivities of Lurie Children's, please see Question 5 below Part

I Line 3 Patient education of eligibility for assistance Lurie Children's financial assistance policy is communicated to thepublic and patients frequentl y and in many ways New patientsreceive a written notice informing them about Lurie Child rev'sfinancial assistance policy and are requested to sign astatement at least annually confirming that they have receivedthis policy Signs are posted at all areas of registrat ion, lobbiesof our facilities, reception, clinical areas, waiting rooms, and theemergenc y department directing patients who have need offinancial assistance to contact our finan cial counselorsPamphlets, distributed through the Hospital and other facilities,titled "Billing/Financial Assistance and Understanding YourBill" provide information about the b ills that the patients can beexpected to have received and direct patients who may need ffinancial assistance to contact our financial counselors Inaddition, a link is shown on o ur website entitled "Financialssistance " Clicking on this link will take someone to the

hospital's application form and instructions Availability offinancial assistance is als o noted on the front and back of thefirst page of the patient statement Lurie Children's hasfinancial counselors who are trained to assist and advisepatients as to the availabi lity of a variety of social services andresources, including state Medicaid, Allkids (ano ther Statensurance program available to children from families whosencome exceeds the thresholds for Medicaid eligibility), and theHospital's charitable assistance program Th e Hospital's staffactively assists inpatients and outpatient surgery patients whoare eli gable for Medicaid in applying for and obtaining thesebenefits In the ambulatory clinic setting, applications forIlKids, are provided to patients Where individuals are not eli

gable for such programs and there is need for financialassistance, the Hospital's finance al counselors assist patientsand families in applying for charitable assistance available fromthe Hospital A patient may qualify for financial assistance atany time, including after applicable insurance limits may havebeen exhausted Part VI Line 4 Community inform ation LurieChildren's is unique in the community and the State of Illinoisas it is the only freestanding pediatric hospital in the State andts tertiary services includes a Lev el I trauma center and LevelIII neonatal nursery which serves as a regional referral cent erfor the State of Illinois' Perinatal Network In addition, for morethan 60 years, Luri e Children's has served as the pediatrictraining site for Northwestern University's Feinb erg School ofMedicine, training residen




PART VI, LINE 5 COMMUNITY BUILDING Lurie Children's spends a substantial amount each year to build

ACTIVITIES and promote the general he alth of the community it serveshese community-building activities are health-related, a nd

the amounts expended are included in the community benefitsreported in Part I, line 7e Lurie Children's engages in a broadspectrum of activities in furtherance of its mission to providehealth care, research, teaching and advocacy for the promotionof children's well-being Lurie Children's is a leader in providingnecessary health care services as wel I as education andadvocacy about important issues affecting children LurieChildren's is a leader in pediatric research, including clinicalresearch aimed at promoting the health and well-being ofchildren in the community and beyond Lurie Children's partnerswith ma ny community programs intended to provide access tohealth-related services, health educat ion, injury prevention andadvocacy for important initiatives to improve children's healthLurie Children's also spends significant resources towardgraduate medical education, providing specialized training inpediatric specialty medicine, including specialty areas wh erethere are severe shortages of clinicians and few graduates eachyear Following are ex amples of some of the community-building initiatives in which Lurie Children's participate s LurieChildren's operates a primary care clinic in Chicago's Uptownneighborhood, prove ding needed primary care services,ncluding check-ups, back-to-school and sports physical s,mmunizations, vision and hearing screening and sick-child careby pediatric staff rest dents, supervised by attendingphysicians Lurie Children's also has established collaborations with community resources and agencies, includingChicago Public Schools for various programs to support HIV-affected children attending school, assisting children withcochle ar implants in re-entering school, and supportingchildren with epilepsy who attend Chicag o Public Schools andsuburban schools In addition, Lurie Children's collaborateswith the Illinois Division of Specialized Care for Children as ameans to meet identified needs in the patients it serves LurieChildren's is a leading member of The Consortium to Lower 0besity in Chicago Children (CLOCC) which brings togetherhundreds of organizations to conf ront childhood obesity inChicago, by facilitating connections between researchers,public health advocates and practitioners, corporations,policymakers, children, families and co mmunities The InjuryPrevention and Research Center (IPRC) at Lurie Children'sstrives to educate the public about injury prevention, improvepublic policy and foster protective e nvironments for children,while coordinating all injury prevention initiatives at Lurie Chldren's Lurie Children's also strives to serve children who havespecial health care nee ds and approximately 13-18 percent ofchildren under 18 have such needs Such children and theirfamilies often encounter uncoordinated care and othersignificant barriers while se eking multiple health resourcesLurie Children's provides education on car seat safety an dprovides car seats to patients who do not have the means topurchase a car seat for thei r child Lurie Children's alsoeducates and advocates for prevention of childhood injuries ,ncluding injury prevention in children (particularly unintentionalnjuries such as pre vention of falls, playground safety andbutton batteries), as well as has been a leader in issues relatedto early HIV testing for newborns The Office of Child Advocacyat Lurie C hildren's emphasizes prevention and healthpromotion and addressing the leading causes of hospitalizationand death among children, which stem from behavioral,environmental and so cial factors Lurie Children's is also aeader in advocating for the prevention of violen ce againstchildren and, for the past several years, has led the effort tocreate the Illi noes Violent Death Reporting system, to create astate-wide database correlating informati on on violent deaths,n an effort to determine emerging patterns and develop moreeffects ve violence prevention policies and programs TheHospital devotes significant resources t o family supportservices which include social work, pastoral care, parenteducation and o ther family amenities to address emotional,social and spiritual needs of hospitalized chi Idren and theirfamilies Other Information The Lurie Children's mission is toprovide pe diatric health care, research, teaching and advocacyfor issues related to children Lurie Children's governing boardas well as the various advisory boards (Family Advisory Board,Kids' Advisory Board and Community Advisory Boards) iscomprised of volunteers from the c ommunity who haveknowledge of the community and a broad range of expertise TheHospital provides more pediatric patient care than any otherhospital in Illinois in nearly every pediatric and surgicalspecialty Lurie Children's




PART VI, LINE 5 COMMUNITY BUILDING operates a 24 hour, 7 day per week pediatric emergency room,

ACTIVITIES including a Level I trauma ce nter and Level III neonatalnursery that serves as a regional referral center for the Stat e ofIllinois' Perinatal Network The Hospital is the largest providerof Medicaid services to Illinois children, serving 57% moreinpatients and outpatients than the next leading provider TheHospital's pediatric physician specialists provide more servicesto children insured by the State of Illinois' AIIKids insuranceprogram (Medicaid) than any other pro vider The Hospital'sability to treat the most critically ill infants is demonstrated bythe fact that in calendar year 2012, 64% of all transports intoits neonatal intensive care unit were from other Level IIInurseries in the Chicago metropolitan area In fiscal yea r2012, Lurie Children's served more than 149,000 patients fromthe State of Illinois and elsewhere in more than 70 pediatricspecialties offered by the Hospital In keeping with its exemptpurposes, surplus funds of the Hospital are utilized to improvethe quality of p atient care, expand or improve its facilities, andadvance medical training, education and research programs InFY 2012 Lurie Children's has completed constructing a new,modern, hospital facility located on the campus of NorthwesternUniversity's Feinberg School of Me dicine ("NUFSM"), designedto continue to provide the highest quality medical care, betterserve patients and families and enhance the ability to recruithigh quality physician fac ulty to provide clinical services,conduct research and train residents and fellows Among thekey design features aimed at improving the care and privacy ofour pediatric patients is private patient rooms Further, the Kids'Advisory Board and Family Advisory Board were activelyinvolved in making suggestions about the design of the newHospital from the pe rspective of patients and families and thenew Hospital reflects many of their insightful recommendationsLurie Children's also increases access to its services byoperating numerous outpatient specialty clinics in variouslocations throughout the Chicago metropolitan area, convenientfor patients and families to access the scarce, pediatricspecialty and s ub-specialty services that would not otherwisebe immediately available Lurie Children's also providesphysician coverage through neonatologists, pediatricintensivists and pediatric hospitalists and pediatric emergencymedicine physicians at eleven other hospitals loc ated inChicago as well as the suburban areas Currently, LurieChildren's provides these services to Northwestern MemorialHospital's Prentice Women's Hospital, Cadence Health DuP ageHospital, Cadence Health Delnor Hospital, Northwestern LakeForest Hospital, Northwest Community Hospital, ShermanHealth, Silver Cross Hospital, Swedish Covenant Hospital, Norwegian American, West Suburban Medical Center, and La RabidaChildren's Hospital, a specia Ity children's hospital in Chicagoserving children with chronic medical conditions Again , thesespecialized services would not otherwise be readily availableLurie Children's is involved with numerous partnerships withcommunity organizations and leaders to promote t he health andwell-being of the children it serves Lurie Children's also servesas a majo r academic tertiary care medical center and serves asthe primary pediatric practice site for NUFSM and provides theclinical training for NUFSM's resident physicians, fellows andmedical students in pediatric specialties and sub-specialtiesEach year, the Lurie Children's Department of Pediatrics trainsapproximately 200 physicians Almost half are pediatr isresidents and the remainder are fellows in various pediatric sub-specialties including cardiology, hematology/oncology andneonatology In addition, the Lurie Children's Departm ent ofSurgery provides formal resident education to NUFSM in each ofits ten divisions an d trains rotating residents from various




Part VI Line 6 A ffiliated Healthcare System Lurie Children ' s employs, through affiliated faculty practiceplans entities, pediatric specialists and sub-specialists whoprovide patient care at locations in Chicago and thesurrounding communities In accordance with the mission ofLurie Children's, these physician groups provide more servicesto Medicaid patients than any other physician providers inIllinois In connection with their extensive treatment ofMedicaid patients, in fiscal year 2012 these physician affiliateswere paid $23 8 million less than the costs of providing theservices than the payments actually received for the servicesIn addition, Lurie Children's, through its affiliate, LurieChildren's Research Center, performs research aimed atadvancements in the prevention, diagnosis and treatment ofdiseases that affect the development of children throughadolescence as well as adult disorders that derive from themLurie Children's Research Center, one of a few institutions inthe U S dedicated exclusively to pediatric research, operates,in part, in a five-story, 125,000 square foot state-of-the-artlaboratory and research administration facility as well as in thehospital and the campus of Northwestern University LurieChildren's Research Center research encompasses basicresearch studies as well as those with potential clinicalapplications In fiscal year 2012, there were more than 200physician-scientists engaged in research and more than 450papers related to the research activities by Lurie Children'sresearchers were published in peer-reviewed journals Inaddition, there were over425 funded research projects whichreceived over $33 million in annual funding from externalsponsors such as the National Institutes of Health See the taxinformation return of Lurie Children ' s Research Center (EIN#36-3357005 ) for additional information The Ann & Robert HLurie Children's Hospital of Chicago Foundation (" LurieChildren's Foundation"), another affiliate of Lurie Children's, isresponsible for fundraising for the hospital and its affiliated tax-exempt organizations These philanthropic dollars support theprograms in furtherance of the hospital's mission and benefitingthe community served, including the establishment andconstruction of the new hospital Fundraising by LurieChildren's Foundation and Lurie Children ' s for fiscal year 2012was $75 2 million from more than 56,000 donors See the taxinformation return of Lurie Children's Foundation (EIN #36-3357006)foradditional information In addition, in connectionwith its relationship with NUFSM, Lurie Children ' s is a memberinstitution of The McGaw Medical Center of NorthwesternUniversity ("McGaw") McGaw is an Illinois not-for-profitcorporation, exempt from federal income taxation pursuant toSection 501(c)(3) of the Internal Revenue Code McGaw is acharitable and educational consortium of four independenthospitals and NUFSM The goal of McGaw is to facilitateeducation and coordinate NUFSM medical residency andfellowship programs among the member institutions LurieChildren's, Northwestern Memorial Hospital, NUFSM and theRehabilitation Institute of Chicago Through McGaw, itsmember institutions provide training to approximately 748residents and 286 fellows during academic year 2012 and LurieChildren's serves as the primary teaching site forapproximately 110 pediatric residents and 83 pediatricsubspecialty fellows In addition, trainees from the adultprograms of McGaw rotate to Lurie Children's for varyinglengths of time to fulfill the pediatric component of their trainingprogram Part VI Line 7 State filing of community benefit reportIL


efile GRAPHIC print - DO NOT PROCESS I As Filed Data - I DLN: 93493192007243

Schedule I OMB No 1545-0047

(Form 990) Grants and Other Assistance to Organizations, 2011Governments and Individuals in the United StatesComplete if the organization answered "Yes," to Form 990, Part IV, line 21 or 22.

Department of the Treasury l Attach to Form 990Internal Revenue Service

Name of the organization Employer identification number

Ann & Robert H Lurie Children's Hospital of36-2170833Chicago

jlj^l General Information on Grants and Assistance

1 Does the organization maintain records to substantiate the amount of the grants or assistance, the grantees' eligibility for the grants or assistance, andthe selection criteria used to award the grants or assistance? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F Yes 1 No

2 Describe in Part IV the organization's procedures for monitoring the use of grant funds in the United States

Grants and Other Assistance to Governments and Organizations in the United States . Complete if the organization answered "Yes" toForm 990, Part IV, line 21 for any recipient that received more than $5,000. Check this box if no one recipient received more than $5,000. UsePart IV and Schedule I-1 (Form 990) if additional space is needed . . . . . . . . . . . . . . . . . . . . . . . . . F

(a) Name and address of ( b) EIN (c) IRC Code section ( d) Amount of cash ( e) Amount of non- (f ) Method of (g) Description of (h) Purpose of grantorganization if applicable grant cash valuation non - cash assistance or assistance

or government assistance ( book, FMV, appraisal,other)

(1) Lurie Children's 36-3357006 501(C)(3) 3,344, 143 net asset transferFoundation225 E CHICAGOAVEChicago,IL 606112991

(2) Lurie Children's 36-3357005 501(C)(3) 5,570,081 Net Asset TransferResearch Center225 ECHICAGO AVEChicago,IL 606112991

(3) CHILDREN'S HOSPITAL 36-3357004 501(C)(3) 684,325 NET ASSETOF CHICAGO MEDICAL Ctr TRANSFER225 E CHICAGO AVEChicago,IL 606112991

(4) Pediatric Faculty 36-3279680 501(C)(3) 11,518,673 NET ASSETFoundation Inc225 E TRANSFERCHICAGO AVEChicago,IL 606112991

(5) Lurie Children's 36-3357005 501(C)(3) 3,536,282 Funds released fromResearch Center225 E restrictionCHICAGO AVEChicago,IL 606112991

(6) Pediatric Faculty 36-3279680 501(C)(3) 8,007,764 Funds released fromFoundation Inc225 E restrictionCHICAGO AVEChicago,IL 606112991

(7) CHILDREN'S HOSPITAL 36-3357004 501(C)(3) 817,198 Funds released fromOF CHICAGO MEDICAL Ctr restriction225 E CHICAGO AVEChicago,IL 606112991

(8) Children's Surgical 36 -3283051 501(C)(3) 965,177 academic grantFoundation225 E CHICAGOAVECHICAGO,IL 606112991

(9) Near North Health 36-3197647 501(C)(3) 100,000 one-time communityServices Corp1276 N benefit grantCLYBOURN AVENUECHICAGO,IL 60610

(10) Northwestern Memorial 37-0960170 501(C)(3) 250,000 bridge paymentHospital251 E Huron StCHICAGO,IL 606113309

2 Enter total number of section 501(c)(3) and government organizations listed in the line 1 table . . 7

3 Enter total number of other organizations listed in the line 1 table . ► 0

For Privacy Act and Paperwork Reduction Act Notice, see the Instructions for Form 990 . Cat No 50055P Schedule I (Form 990) 2011

Schedule I (Form 990) 2011 Pa g e 2

Grants and Other Assistance to Individuals in the United States . Complete if the organization answered "Yes" to Form 990, Part IV, line 22.Use Schedule I-1 (Form 990) if additional space is needed.

(a)Type of grant or assistance (b)N umber ofrecipients

(c)Amount ofcash grant

(d)Amount ofnon-cash assistance

(e)Method of valuation(book,

FMV, appraisal, other)

(f)Description of non-cash assistance

Suuulemental Information . Complete this Dart to provide the information reauired in Part I. line 2. and any other additional information.


Form 990, Schedule I Description of Organization's We review all grant funds on a monthly basis Financial reports are generated monthly and distributed electronically to all fundProcedures for Monitoring the directors and the Office of Sponsored Projects (OSP) for review Expenditures are reviewed for appropriateness and againstUse of Grants budgetary guidelines by the Finance Office (Fund Accounting) OSP and Fund Accounting work with the investigators to

monitor their activity and make sure they are in compliance with the terms of the award

Schedule I (Form 990) 2011

Additional Data

Software ID:

Software Version:

EIN: 36-2170833

Name : Ann & Robert H Lurie Children's Hospital ofChicago

Form 990,Schedule I, Part II, Grants and Other Assistance to Governments and Organizations in the United States

(a) Name andaddress oforganization

or government

(b) EIN (c) IRC Codesection

if applicable

(d) Amount ofcash grant

(e) Amount ofnon-cashassistance

(f) Method ofvaluation

(book, FMV,appraisal,other)

(g) Descriptionof

non-cashassistance

(h) Purpose ofgrantor assistance

Lurie Children'sFoundation225 ECHICAGO AVE

36-501(C)(3)

net asset

Chicago,IL3357006 3,344,143 transfer

606112991

Lurie Children'sResearch Center225 E CHICAGO 36-

501(C)(3)Net Asset

AV E 3357005 5,570,081 TransferChicago, IL606112991

Return to Form



or government

( b) EIN (c) IRC Codesection

if applicable


( e) Amount ofnon - cashassistance

( f) Method ofvaluation

(book, FMV,appraisal,other )

( g) Descriptionof

non -cashassistance


CHILDREN'SHOSPITAL OFCHICAGO

36- NET ASSETMEDICAL Ctr225 E 501(C)(3)CHICAGO AVE

3357004 684,325 TRANSFER

Chicago, IL606112991

Pediatric FacultyFoundation Inc225E CHICAGO AVE

36-501(C)(3)

NET ASSET

Chicago, IL3279680 11,518,673 TRANSFER

606112991



or government


if applicable


(e) Amount ofnon-cashassistance



(g) Descriptionof

non-cashassistance


Lurie Children'sResearch Center225 E CHICAGO 36-

501(C)(3)Funds released

AVE 3357005 3,536,282 from restrictionChicago, IL606112991

Pediatric FacultyFoundation Inc225

36- Funds releasedE CHICAGO AVE

3279680501(C)(3)

8 007 764 from restrictionChicago, IL , ,

606112991


(a) Name and addressof organizationor government

( b) EIN (c ) IRC Codesection

if applicable


( e) Amount ofnon-cashassistance

( f) Method ofvaluation


(g) Descriptionof

non -cashassistance


CHILDREN'SHOSPITAL OFCHICAGO

36 - Funds releasedMEDICAL Ctr225 E

3357004501(C)(3)

817 198 from restrictionCHICAGO AVE ,

Chicago, IL606112991

Children's SurgicalFoundation225 ECHICAGO AVE

36-501(C)(3) academic grant

CHICAGO,IL3283051 965,177

606112991


(a) Name and addressof organizationor government


if applicable


(e) Amount ofnon - cashassistance



( g) Descriptionof

non- cashassistance

( h) Purpose ofgrantor assistance

Near North HealthServices Corp1276

one-timeN CLYBOURN 36-

501(C)(3) communityAVENUE 3197647 100,000 benefit grantCHICAGO,IL60610

NorthwesternMemorial Hospital

37-251 E Huron St

0960170501(C)(3)

250 000bridge payment

CHICAGO,IL ,

606113309


Schedule J Compensation Information OMB No 1545-0047

(Form 990)For certain Officers, Directors, Trustees, Key Employees, and Highest

2011Compensated Employees1- Complete if the organization answered "Yes" to Form 990,

Department of the Treasury Part IV, question 23. PublicOpen to

Internal Revenue Service 1- Attach to Form 990. 1- See separate instructions. Inspection


Questions Regarding Compensation

la Check the appropiate box(es ) if the organization provided any of the following to or for a person listed in Form990, Part VII , Section A, line la Complete Part III to provide any relevant information regarding these items

1 First-class or charter travel F Housing allowance or residence for personal use

1 Travel for companions 1 Payments for business use of personal residence

F Tax idemnification and gross - up payments F Health or social club dues or initiation fees

1 Discretionary spending account 1 Personal services ( e g , maid, chauffeur, chef)

Yes I No

b If any of the boxes in line la are checked, did the organization follow a written policy regarding payment orreimbursement orprovision of all the expenses described above? If "No," complete Part III to explain lb Yes

2 Did the organization require substantiation prior to reimbursing or allowing expenses incurred by allofficers, directors, trustees, and the CEO/Executive Director, regarding the items checked in line la? 2 Yes

3 Indicate which , if any, of the following the organization uses to establish the compensation of theorganization 's CEO/Executive Director Check all that apply

F Compensation committee fl Written employment contract

F Independent compensation consultant F Compensation survey or study

fl Form 990 of other organizations F Approval by the board or compensation committee

4 During the year, did any person listed in Form 990, Part VII, Section A, line la with respect to the filing organizationor a related organization

a Receive a severance payment or change-of-control payment? 4a No

b Participate in, or receive payment from, a supplemental nonqualified retirement plan? 4b Yes

c Participate in, or receive payment from, an equity-based compensation arrangement? 4c No

If "Yes" to any of lines 4a-c, list the persons and provide the applicable amounts for each item in Part III

Only 501 ( c)(3) and 501 ( c)(4) organizations only must complete lines 5-9.

5 For persons listed in form 990, Part VII, Section A, line la, did the organization pay or accrue anycompensation contingent on the revenues of

a The organization? 5a No

b Any related organization? 5b No

If "Yes," to line 5a or 5b, describe in Part III

6 For persons listed in form 990, Part VII, Section A, line la, did the organization pay or accrue anycompensation contingent on the net earnings of

a The organization? 6a No

b Any related organization? 6b No

If "Yes," to line 6a or 6b, describe in Part III

7 For persons listed in Form 990, Part VII, Section A, line la, did the organization provide any non-fixedpayments not described in lines 5 and 6? If "Yes," describe in Part III 7 Yes

8 Were any amounts reported in Form 990, Part VII, paid or accured pursuant to a contract that wassubject to the initial contract exception described in Regs section 53 4958-4(a)(3)? If "Yes," describein Part III 8 No

9 If "Yes" to line 8, did the organization also follow the rebuttable presumption procedure described in Regulationssection 53 4958-6(c)? 9

For Privacy Act and Paperwork Reduction Act Notice, see the Intructions for Form 990 Cat No 50053T Schedule 3 ( Form 990) 2011

Schedule J (Form 990) 2011 Page 2

Officers , Directors , Trustees, Key Employees, and Highest Compensated Employees . Use Schedule 3-1 if additional space needed.

For each individual whose compensation must be reported in Schedule J, report compensation from the organization on row (i) and from related organizations, described in theinstructions on row (ii) Do not list any individuals that are not listed on Form 990, Part VII

Note . The sum of columns (B)(1)-(iii) for each listed individual must equal the total amount of Form 990, Part VII, Section A, line la, columns (D) and (E) for that individual

(A) Name (B) Breakdown of W-2 and/or 1099-MISC compensation (C) Retirement and (D) Nontaxable (E) Total of columns (F) Compensation

(i) Basecompensation

(ii) Bonus &incentive

compensation

(iii) Otherreportable

compensation

other deferred

compensation

benefits (B)(1)-(D) reported in prior

Form 990 or

Form 990-EZ


Schedule 3 (Form 990) 2011

Schedule J (Form 990) 2011 Page 3


Complete this part to provide the information, explanation, or descriptions required for Part I, lines la, 1b, 4c, 5a, 5b, 6a, 6b, 7, and 8 Also complete this part for any additional information


Explanation

Supplemental Schedule J, The organization provides membership in a club and a professional organization used by Patrick Magoon, the Medical Center and Lurie Children's ChiefCompensation Part I, Executive Officer, for business purposes Such membership is treated by the organization as a working-condition fringe benefit and is, therefore, excluded fromInformation Question 1a the individual's taxable income The organization provides membership in a professional organization used by Edward Ogata, M D , Chief Medical Officer, for

business purposes Such membership is treated by the organization as a working-condition fringe benefit and is, therefore, excluded from the individual'staxable income The organization provides membership in a club used by Thomas Sullivan, President of the Ann & Robert H Lurie Children's Hospital ofChicago Foundation, for business purposes Such membership is treated by the organization as a working-condition fringe benefit and is therefore, excludedfrom the individual's taxable income The organization provided tax indemnification gross-up payments for temporary housing and travel expenses provided toRobert J Powell, the new Chief of Human Resources for Ann & Robert H Lurie Childrens Hospital of Chicago The payments were limited and modest in amountSchedule J, Part I, Line 3 Pursuant to the bylaws of Children's Hospital of Chicago Medical Center ("Medical Center"), the Governance Committee of theMedical Center is charged to review and approve senior executive compensation for the Medical Center and its affiliates The Governance Committee hasadopted a written executive compensation philosophy which it follows when it reviews and approves the compensation and benefits of the organization's seniormanagement, including the President/Chief Executive Officer and the other senior managers The compensation philosophy is subject to periodic review forcontinued appropriateness by the Governance Committee With the assistance of a compensation consultant and information from a variety of sources(specified on Schedule J), the Governance Committee confirmed the total amounts to be paid were reasonable and comparable to amounts paid by similarlysituated organizations Outside legal counsel also serves an integral role in advising the Governance Committee with respect to federal tax requirements insetting compensation and the establishment of the "rebuttable presumption of reasonableness" under the federal tax law intermediate sanctions rules Theprocess followed by the Governance Committee, including a description of the data relied upon and the Governance Committee's decisions, was thoroughly andcontemporaneously documented The Governance Committee has expressly reviewed the reasonableness of all such payments, and has concluded, as theresult of a process that is designed to qualify for the rebuttable presumption of reasonableness, that all such amounts are reasonable and do not exceed fairmarket value for the services provided The Governance Committee was comprised of members of the Medical Center and the Ann and Robert H LurieChildren's Hospital of Chicago Boards of Directors who were determined to be disinterested for these purposes The Governance Committee conducts anongoing, regular review of the disinterested status of its members, and will take appropriate action with respect to anyone having an interest with respect to oneor more executives so as to preserve the application of the rebuttable presumption of reasonableness Schedule J, Part I, Question 4b The following listedindividuals participated in the organization's supplemental executive retirement plan ("SE RP") and earned unvested benefits during 2011, which are reported inColumn (C) James Donaldson, MD $166,689 Susan H Gordon $ 68,394 Stanley B Krok $211,077 Patrick Magoon $361,818 Maureen Murphy $ 77,514Paula M Noble $188,823 Michelle M Stephenson $108,261 Donna Wetzler$342,069 Benefits earned under the SERP are non-vested forms of deferredcompensation that fund the employee's eventual retirement benefit These benefits are provided in exchange for all of the employee's years of service to theorganization, and the cost of the benefits will vary from year to year based on interest rates, age, and many other factors The amounts are at risk and will not bepaid unless and until the employee has provided substantial future services to the organization Benefits under the SERP vest at age 62, and are forfeited if theemployee leaves the organization voluntarily before age 62 (except upon the sole discretion of the Board, and only if the participant has reached at least age 55with at least 10 years of service) Participants who voluntarily leave the organization before age 55 forfeit their entire SE RP benefit upon termination Also inresponse to question 4b, the following listed individuals received credited interest from the supplemental retirement benefits under the SERP, and therefore hadmulti-year SERP benefits included in their taxable income Thomas J Sullivan, $96,642 and Edward 0 gata M D $65,215 In each case, the taxable amountrepresents the credited interest on the value of benefits earned over many years of service to the organization, and which became paid and taxable in 2011The Governance Committee of the organization's Board of Directors annually reviews all forms of executive compensation and benefits, including all reportedvested and nonvested SERP benefits, and has concluded, as the result of a process that it is designed to qualify for the rebuttable presumption ofreasonableness, that total compensation and the benefits provided are reasonable Schedule J, Part I, Question 7 The organization provides annual incentivecompensation to senior management under a senior management incentive compensation plan These amounts are included in Schedule J, Part II, Column B(ii) The plan is designed to offer opportunities for additional compensation tied to performance against pre-determined financial, patient satisfaction, patientsafety and individual goals approved in advance by the Governance Committee of the Ann & Robert H Lurie Children's Hospital of Chicago (Lurie Children's)and the Children's Hospital of Chicago Medical Center (Medical Center), which serves as the Compensation Committee of Lurie Children's and Medical CenterDue to the CEO's unique role in setting and driving the long term strategic mission and operational performance of the entire organization, the GovernanceCommittee of Lurie Children's and Medical Center has established a long term incentive Program ("LTI") underwhich the CEO, Patrick Magoon, is the soleparticipant Mr Magoon is eligible to earn additional compensation for achievement of very challenging, long term goals that are established in advance by theGovernance Committee The LTI also serves as a retention vehicle since amounts earned are vested on a rolling basis over a multi-year period During thereporting year and included in schedule J, Part II, column B (ii), are $54,248 of LTI paid to the CEO, and this entire amount was previously reported as deferredcompensation The Governance Committee has expressly reviewed the reasonableness of all such payments, and has concluded, as the result of a process thatis designed to qualify for the rebuttable presumption of reasonableness under federal tax law, that all such amounts are reasonable and do not exceed fairmarket value for the services provided Schedule J, Part II The following individuals are not compensated by the reporting organization for his or her service asa director Rather, the compensation reported on Form 990, Part VII and on Schedule J, Part II reflects compensation paid by Pediatric Faculty Foundation forthe individual's substantial and full-time services as an employee For more details, please refer to the 2011 Form 990 of Pediatric Faculty Foundation, FEIN36-3279680 Thomas P Green, MD Mary J C Hendrix, PhD H William Schnaper, MD James Donaldson, MD is not compensated by the reporting organizationfor his service as a director Rather, the compensation reported on Form 990, Part VII and on Schedule J, Part II reflects compensation paid by Children'sHospital of Chicago Medical Center for the individual's substantial and full-time services as an employee For more details, please referto the 2011 Form 990of the Children's Hospital of Chicago Medical Center, FEIN 36-3357004

Schedule 3 (Form 990) 2011

Additional Data

Software ID:

Software Version:

EIN: 36-2170833


Return to Form

Form 990, Schedule J. Part II - Officers, Directors, Trustees , Key Employees , and Highest Compensated Employees

(A) Name (B) Breakdown of W-2 and/or 1099-MISC compensation (C) Deferred (D) Nontaxable (E) Total of columns (F) Compensation

(i) Base (ii) Bonus &(iii) Other

compensation benefits (B)(i)-(D) reported in prior Form990 or Form 990-EZ

Compensationincentive

compensationcompensation

JAMES DONALDSON (1) 0 0 0 0 0 0 0MD (u) 441,714 89,526 2,099 196,979 21,564 751,882 0

THOMAS P GREEN MD (1)(11)

0486,587

0198,879

0792

024,500

033,602

0744,360

00

MARY J C HENDRIX ()i 0 0 0 0 0 0 0PHD ( H) 477,924 96,715 516 65,528 21,914 662,597 0

PATRICK M MAGOON (i) 669,904 460,460 39,553 395,080 22,747 1,587,744 54,248(H) 0 0 0 0 0 0 0

EDWARD OGATA MD (i) 390,921 219,482 88,982 25,687 25,516 750,588 0(H) 0 0 0 0 0 0 0

H WILLIAM (i) 0 0 0 0 0 0 0SCHNAPER MD (ii) 254,059 38,782 792 24,500 27,415 345,548 0

SUSAN H GORDON (i) 217,353 87,660 12,831 90,337 2,709 410,890 0(H) 0 0 0 0 0 0 0

MONICA HEENAN (i) 237,376 98,684 515 68,569 14,191 419,335 0(H) 0 0 0 0 0 0 0

BRUCE KOMISKE (i) 341,208 137,463 14,742 19,125 8,587 521,125 0(H) 0 0 0 0 0 0 0

STANLEY B KROK (i) 260,458 108,098 2,950 235,854 25,531 632,891 0(H) 0 0 0 0 0 0 0

MAUREEN T (i) 185,402 75,704 10,514 84,993 13,838 370,451 0MAHONEY (H) 0 0 0 0 0 0 0

MAUREEN MURPHY (i) 266,704 108,310 13,173 102,628 11,413 502,228 0(H) 0 0 0 0 0 0 0

PAULA M NOBLE (i) 359,324 182,200 1,618 214,043 15,135 772,320 0(H) 0 0 0 0 0 0 0

ROBERT J POWELL (i) 257,610 224,212 760 104,654 5,896 593,132 0(H) 0 0 0 0 0 0 0

MICHELLE M ()i 287,204 120,000 655 131,353 16,946 556,158 0STEPHENSON (H ) 0 0 0 0 0 0 0

DONNA S WETZLER (i) 268,758 137,717 1,856 364,116 17,000 789,447 0(H) 0 0 0 0 0 0 0

SHERWOOD D (i) 193,346 78,849 1,166 20,077 13,779 307,217 0ZELLERMAYER (ii) 0 0 0 0 0 0 0

THOMAS J SULLIVAN (i) 299,152 159,757 110,414 57,720 26,511 653,554 0(H) 0 0 0 0 0 0 0

Form 990, Schedule J . Part II - Officers , Directors , Trustees , Key Employees, and Highest Compensated Employees

(A) Name (B) Breakdown of W-2 and/or 1099-MISC compensation (C) Deferred (D) Nontaxable (E) Total of columns (F) Compensation

(ii) Bonus & compensation benefits (B)(i)-(D) reported in prior Form

(i) Base (iii) Other 990 or Form 990-EZ

Compensationincentive

compensationcompensation

RON H BLAUSTEIN (1) 194,037 59,742 178 15,469 22,954 292,380 0(ii) 0 0 0 0 0 0 0

NANCY M BORDERS (i) 211,421 54,246 842 18,262 23,675 308,446 0(ii) 0 0 0 0 0 0 0

SHERRI R EWING (i) 177,224 54,463 362 15,910 16,470 264,429 0(ii) 0 0 0 0 0 0 0

MORLEY I (i) 201,369 30,876 4,950 16,305 12,752 266,252 0KERSCHNER (ii) 0 0 0 0 0 0 0

PHILIP V SPINA (i) 193,984 36,470 805 20,050 24,745 276,054 0(u) 0 0 0 0 0 0 0

efile GRAPHIC print - DO NOT PROCESS I As Filed Data - I DLN: 93493192007243

Schedule K OMB No 1545-0047

(Form 990) Supplemental Information on Tax Exempt BondsComplete if the organization answered "Yes" to Form 990, Part IV, line 24a. Provide descriptions,1- 2011

explanations, and any additional information in Schedule 0 (Form 990).

Department of the Treasury 1- Attach to Form 990. 1- See separate instructions. •

Internal Revenue Service

Name of the organization Employer identification number

Ann & Robert H Lurie Children's Hospital of36-2170833Chicago

Bond Issues

(h) On(i) Pool

(g) Defeased Behalf of(a)Issuer Name (b)IssuerEIN

(c

)CUSIP #

(d)Date Issued (e) Issue Price

(f) Description of Purpose financingIssuer

Yes No Yes No Yes No

Illinois Finance AuthorityA86-1091967 45200FGC7 05-15-2008 377,043,130 SEE SCHEDULE K PART VI X X X

ILLINOIS FINANCEB AUTHORITY 86-1091967 45200FGR4 05-15-2008 173,490,000 SEE SCHEDULE K PART VI X X X

Illinois Finance AuthorityC86-1091967 02-28-2012 60,000,000 SEE SCHEDULE K PART VI

n n " Proceeds

A B C D

1 Amount of bonds retired 0 114,100,000 0

2 A mount of bonds defeased 0 0 0

3 Total proceeds of issue 383 ,720,219 173,514,604 60,000,000

4 Gross proceeds in reserve funds 14,537,612 0 0

5 Capitalized interest from proceeds 45,353,927 0 0

6 Proceeds in refunding escrow 0 172,714,594 0

7 Issuance costs from proceeds 3,119,559 589,202 474,000

8 Credit enhancement from proceeds 6,305,197 52,764 0

9 Working capital expenditures from proceeds 0 158,044 0

10 Capital expenditures from proceeds 314,403,923 0 59,450,133

11 Other spent proceeds 0 0 0

12 Other unspent proceeds 0 0 0

13 Year of substantial completion 2012 2006 2012

Yes No Yes No Yes No Yes No

14 Were the bonds issued as part of a current refunding issue? X X X

15 Were the bonds issued as part of an advance refunding issue? X X X

16 Has the final allocation of proceeds been made? X X X

17 Does the organization maintain adequate books and records to support the finalallocation of proceeds?

X X X

iIII Private Business Use

A B C D


1 Was the organization a partner in a partnership, or a member of an LLC, which ownedX X X

property financed by tax-exempt bonds?

2 Are there any lease arrangements that may result in private business use of bond-X X X

financed property?

For Privacy Act and Paperwork Reduction Act Notice, see the Instructions for Form 990 . Cat No 50193E Schedule K (Form 990) 2011

Schedule K (Form 990) 2011 Pa g e 2

Private Business Use (Continued)

A B C D


3a Are there any management or service contracts that may result in private businessuse?

X X X

b If'Yes'to line 3a, does the organization routinely engage bond counsel or other outsidecounsel to review any management or service contracts relating to the financed X X Xproperty?

c Are there any research agreements that may result in private business use of bond-financed property? X X X

d If'Yes'to line 3c, does the organization routinely engage bond counsel or other outsidecounsel to review any research agreements relating to the financed property? X X X

4 Enter the percentage of financed property used in a private business use by entitiesother than a section 501(c)(3) organization or a state or local government 0 % 0 % 0 %

0-

5 Enter the percentage of financed property used in a private business use as a result ofunrelated trade or business activity carried on by your organization, another section 0 % 0 %501(c)(3) organization, or a state or local government 0-

6 Total of lines 4 and 5 0% 0 %

7 Has the organization adopted management practices and procedures to ensure thepost-issuance compliance of its tax-exempt bond liabilities?

ArbitrageA B C D


1 Has a Form 8038-T, Arbitrage Rebate, Yield Reduction andPenalty in Lieu of Arbitrage Rebate, been filed with respect to thebond issue?

X X X

2 Is the bond issue a variable rate issue? X X X

3a Has the organization or the governmental issuer enteredinto a hedge with respect to the bond issue?

X X X

b Name of provider 0 0 0

c Term of hedge

d Was the hedge superintegrated?

e Was a hedge terminated?

4a Were gross proceeds invested in a GIC? X X X

b Name of provider 0 0 0

c Term of GIC

d Was the regulatory safe harbor for establishing the fair marketvalue of the GIC satisfied?

5 Were any gross proceeds invested beyond an available temporaryperiod? X X X

6 Did the bond issue qualify for an exception to rebate?X X X

Procedures To Undertake Corrective Action

Check the box if the organization established written procedures to ensure that violations of federal tax requirements are timely identified and corrected through the voluntaryclosing agreement program if self-remediation is not available under applicable regulations 17 Yes fl No

IFTWOM Supplemental information

Complete this part to provide additional information for responses to questions on Schedule K (see instructions)

I IIdentifier Return Explanation

Reference

SEE I0SCHEDULE 0

Schedule K (Form 990) 2011


Schedule L Transactions with Interested Persons OMB No 1545-0047

(Form 990 or 990-EZ) 1- Complete if the organization answered

2011"Yes" on Form 990, Part IV , lines 25a , 25b, 26, 27, 28a, 28b, or 28c,or Form 990-EZ, Part V lines 38a or 40b.

Department of the Treasury 1- Attach to Form 990 or Form 990-EZ . 1-See separate instructions . Open

Internal Revenue Service Inspection


L^l Excess Benefit Transactions (section 501(c)(3) and section 501 (c)(4) organizations only).

Loans to and/or From Interested Persons.C'mmnlata iftha nrnannatinn ancwarari "Vac" nn Fnrm QQn Part T\/ Imp 7A, nr Fnrm QQn-F7 Part \/ lino '3Ra

(a) Name of interested person andpurpose

(b) Loan toor from the?

organization(c)Original

principal amount(d)Balance due

(e) Indefault?

App o)vedby board orcommittee?

(g )Writtenagreement?

To From Yes No Yes No Yes No

Total $

IT.IIl Grants or Assistance Benefitting Interested Persons.Com p lete if the org anization answered "Yes" on Form 990 , Part IV, line 27.

(a) Name of interested person(b)Relationship between interested person

(c)Amount of grant or type of assistanceand the organization

For Privacy Act and Paperwork Reduction Act Noticee see the Cat No 50056A Schedule L (Form 990 or 990 - EZ) 2011Instructions for Form 990 or 990-EZ.

2 Enter the amount of tax imposed on the organization managers or disqualified persons during the year undersection 4958 . . . . . . . . . . . . . . . . . . . . . . . . . ► $

3 Enter the amount of tax, if any, on line 2, above, reimbursed by the organization . ► $

Schedule L (Form 990 or 990-EZ) 2011 Page 2

Business Transactions Involving Interested Persons.

Complete if the organization answered "Yes" on Form 990, Part IV, line 28a, 28b, or 28c.

(a) Name of interested person

(b) Relationshipbetween interested

person and the(c) Amount oftransaction

escription of transaction(d) Description

(e) Sharing of

revenues?

organization Yes No


4-


Complete this part to provide additional information for responses to questions on Schedule L (see instructions)


Schedule L (Form 990 or 990-EZ) 2011

Additional Data

Software ID:

Software Version:

EIN: 36-2170833


Form 990, Schedule L, Part IV - Business Transactions Involving Interested Persons

(a) Name of interested person ( b) Relationship (c) Amount of ( d) Description of transaction ( e) Sharing ofbetween interested transaction $ organization's

person and the revenues?organization

Yes No

Alexis Baby Family Member of 53,670 Employment NoBaine

AON Case is 416,242 Insurance Brokerage Services NoPresident/CEO

JPMorgan Chase L Crown' s son is a Dir 1,759,936 Financial Services No

JPMorgan Chase P Crown 's spouse is a 1,759,936 Financial Services NoDir

Sidley Austin LLP Douglas is Ptnr& 494,687 Legal Services NoCoChair

Merge Healthcare Ferro is an Officer 981,997 Information Technology Svcs No

Northern Trust Logan is an Officer 543,779 Financial Services No

AON A McKenna is a 416,242 Insurance Brokerage Services NoDirector

Element79 Partners LLC Williams is 539,919 Advertising Services NoPresident/CEO


SCHEDULEM NonCash Contributions OMB No 1545-0047

(Form 990)

2011Complete if the organization answered "Yes" on Form

Department of the Treasury990, Part IV, lines 29 or 30.

we

Internal Revenue ServiceP- Attach to Form 990.

^19.wName of the organization Employer identification numberAnn & Robert H Lurie Children's Hospital ofChicago 36-2170833

Types of Property

(a) (b) (c) (d)Check N umber of Contributions Contribution amounts Method of determining

if or items contributed reported on contribution amountsapplicable Form 990, Part VIII, line

1g

1 Art-Works of art . . . .

2 Art-Historical treasures

3 Art-Fractional interests

4 Books and publications

5 Clothing and householdgoods . . . . . . .

6 Cars and other vehicles .

7 Boats and planes . . . .

8 Intellectual property . . .

9 Securities-Publicly traded . X 47 1,749,533 Market

10 Securities-Closely held stock

11 Securities-Partnership, LLC,or trust interests

12 Securities-Miscellaneous

13 Qualified conservationcontribution-Historicstructures

14 Qualified conservationcontribution-Other . . .

15 Real estate-Residential

16 Real estate-Commercial

17 Real estate-Other . . .

18 Collectibles . . . . .

19 Food inventory . . .

20 Drugs and medical supplies

21 Taxidermy . . . . . .

22 Historical artifacts . . . .

23 Scientific specimens . .

24 Archeological artifacts

25 Other n ( )

26 Other(

27 Other(

28 Other n ( )

29 Number of Forms 8283 received by the organization during the tax year for contributionsfor which the organization completed Form 8283, Part IV, Donee Acknowledgement . 29 0

Yes No

30a During the year, did the organization receive by contribution any property reported in Part I, lines 1-28 that it

must hold for at least three years from the date of the initial contribution, and which is not required to be used

for exempt purposes for the entire holding period? 30a No

b If "Yes," describe the arrangement in Part II

31 Does the organization have a gift acceptance policy that requires the review of any non-standard contributions? 31 Yes

32a Does the organization hire or use third parties or related organizations to solicit, process, or sell non-cash

contributions? . . . . . . . . . . . . . . . . . . . . . . . . . . 32a Yes

b If "Yes," describe in Part II

33 If the organization did not report revenues in column (c) for a type of property for which column (a) is checked,

describe in Part II

For Privacy Act and Paperwork Reduction Act Noticee see the Instructions for Form 990 . Cat No 51227] Schedule M (Form 990) 2011

Schedule M (Form 990 ) 2011 Page 2

Supplemental Information . Complete this part to provide the information required by Part I, lines 30b,32b, and 33. Also complete this part for any additional information.


Third parties hired to process Schedule M, Part I, line 32b All securities (non-cash donations) are sent directly to Northernnoncash contributions Trust Northern Trust as Custodian and broker sells the

securities immediately For donor recognition purposes, gifts arevalued at the median prices on the day the securities arereceived For accounting purposes, values are reconciled for anygain/loss on the sale of securities

Schedule M (Form 990) 2011

efile GRAPHIC p rint - DO NOT PROCESS As Filed Data - DLN: 93493192007243

SCHEDULE 0OMB No 1545 0047

(Form 990 or 990-EZ) Supplemental Information to Form 990 or 990-EZ2011

Department of the Treasury Complete to provide information for responses to specific questions onForm 990 or to provide any additional information . Open

Internal Revenue Service1- Attach to Form 990 or 990-EZ. Inspection

Name of the organization Employer identification numberAnn & Robert H Lurie Children's Hospital ofChicago '3A-71 7 n R


Explanation

Description of Form 990, *Allan Bulley III serves as an officer for a firm that provided construction services to Thomas Souleles *AllanRelationships Part VI, Bulley III serves as an officer for a firmwhich provided construction services to Donald J Edwards *Gregory

Question 2 Case serves as an officer for a firm in which Andrew McKenna served as a director during the reportingperiod *Edward J Wehmer serves as an officer for a company for which Charles James III and Bert Getzserve as a director *Lester Crown is the father-in-law of Paula H Crown *William Devers, Jr serves as adirector for a company for which Andrew McKenna serves as an officer *Andrew J McKenna is the father of

William J McKenna *Linda Wolf serves as a director for a company for which Eric Lefkofsky serves as adirector Description of Classes of Members or Stockholders Form 990, Part VI, Question 6 The Children'sHospital of Chicago Medical Center ("Medical Center") is the organization's sole corporate member Descriptionof Classes of Persons and the Nature of Their Rights Form 990, Part VI, Question 7a The organization's solecorporate member, the Medical Center, has certain reserved powers, including the power to appoint andremove all directors of the organization


Explanation

Descr Classes of Form 990, Part The Medical Center, through its Board of Directors or designated committee, as the sole corporatePersons, Decisions VI, Question member of the organization, has certain reserve powers with respect to appointment and removal ofRequiring Appr & 7b directors, appointment of certain officers, approval of amendments to governing documents, approvalType of Voting Rights of financial matters, and approval of significant transactions including, but not limited to, merger,

dissolution, disposition of assets other than in the ordinary course of business, and creation ofsubsidiaries


Explanation

Describe the Form 990, A copy of the organization's fiscal year 2012 tax return ("Form 990") was provided to each member of theProcess used by Part VI, organization's Audit Committee (of the Board) before a special Audit Committee meeting and before the FormManagement Question 990 was filed The Audit Committee is the Committee of the Medical Center charged with the oversight of&/or Governing 11B audit and tax matters for the parent and affiliates The audit committee was provided a detailed overview ofBody to Review the form 990 by the chief financial Officer ("CFO") and the organization's director of tax compliance The CFO990 and director of tax compliance also responded to the Audit Committee members' questions and afforded the

opportunity for detailed discussion of the Form 990, prior to the audit committee taking action to approve Thefiling of the Form 990 As part of its tax preparation process, the Organization on an ongoing basis consultedits tax consulting firm and outside tax legal counsel, both of which possess expertise in health care and tax-exempt return preparation, to advise and assist in the preparation of Form 990 These advisors workedclosely with the organization's Finance and internal legal personnel and other members of the organization'steam assembled to participate in the preparation of The Form 990 Prior to presenting the Form 990 to theboard's audit Committee, the organization's team, including its advisors, met frequently to discuss and reviewdrafts of the form


Explanation

Description of Form 990, On an annual basis, the Medical Center and its affiliates provide a comprehensive questionnaire to its boardProcess to Part VI, members, senior management and purchasing personnel posing questions about actual or potential conflicts ofMonitor Question interest The Medical Center initiates follow up contact to those who do not respond and to clarify responses,Transactions 12c where necessary The Medical Center reviews each disclosure and provides a summary of relevantfor Conflicts of disclosures for the review and approval of its governance committee Pursuant to the conflicts of interest policyInterest of the Medical Center and affiliates ("Corporation"), directors, officers, physician leaders, and others who are

subject to the policy are required to promptly and fully disclose in writing any actual, apparent or potentialconflict of interest to the president of the Corporation and General Counsel This disclosure shall be provided tothe Governance Committee of the Corporation which shall consider all conflicts of interest issues and, ifappropriate, shall provide such written disclosure to the directors, board committees considering the proposedtransaction or other appropriate parties In addition, on an annual basis, the corporation surveys each individualsubject to the policy as to the existence of actual or potential conflicts of interest The corporation will not enterinto an agreement, transaction or other arrangement involving a conflict of interest unless the disinterestedmembers of the Governance Committee of the Corporation's Board of Directors determine by a majority vote thatappropriate safeguards to protect the charitable mission of the Corporation have been implemented The subjectinterested person may not be present w hen the vote is taken If it is determined that a conflict of interest exists,a disinterested person or committee of disinterested members may be assigned to investigate alternatives to theproposed transaction or arrangement After exercising due diligence, the board or committee shall determinewhether the Corporation can obtain a more advantageous transaction or arrangement, with reasonable efforts,from a person or entity that would not give rise to a conflict of interest If a more advantageous transaction orarrangement is not reasonably attainable under circumstances that would not give rise to a conflict of interest,the board or committee shall determine by a majority vote of the disinterested directors whether the transactionis in the Corporation's best interest and for its own benefit and whether the transaction is fair and reasonableto the Corporation, and shall make its decision as to whether to enter into the transaction or arrangement


Explanation

Offices & Form 990, The authority to review and approve executive compensation has been delegated to the Governance CommitteePositions for Part VI, of the Medical Center Board of Directors ("Governance Committee") The Governance Committee has adopted aWhich Question written executive compensation philosophy which it follows when it reviews and approves the compensationProcess 15a & 15b and benefits of the organization's senior management, including the President/Chief Executive Officer and thewas Used, & other senior managers The compensation philosophy is subject to periodic review for continued appropriatenessYear by the Governance Committee With the assistance of a compensation consultant and information from a varietyProcess of external sources (specified on Schedule J), the Governance Committee confirmed the total amounts to be paidwas Begun were reasonable and comparable to amounts paid by similarly situated organizations for functionally similar

positions Outside legal counsel also serves an integral role in advising the Governance Committee with respectto federal tax requirements in setting compensation and the establishment of the rebuttable presumption ofreasonableness The process followed by the Governance Committee, including a description of the data reliedupon and the Governance Committee's decisions, was thoroughly and contemporaneously documented TheGovernance Committee has expressly reviewed the reasonableness of all such payments, and has concluded,as the result of a process that is designed to qualify for the rebuttable presumption of reasonableness underfederal tax law, that all such amounts are reasonable and do not exceed fair market value for the servicesprovided The Governance Committee was comprised of members of the Medical Center and the Medical CenterBoards of Directors who were determined disinterested for these purposes The Governance Committeeconducts an ongoing and periodic review of the disinterested status of its members, and will take appropriateaction with respect to anyone having an interest with respect to one or more executives so as to preserve theapplication of the rebuttable presumption of reasonableness

Identifier Return ExplanationReference

Avail of Gov Docs, Form 990, Part The organization's financial statements are publicly available online at www dacbond com TheConflict of Interest Policy, VI, Question 19 organization 's articles of incorporation and annual reports are available through the Illinois& Fin Stmts to Gen Public Secretary of State The organization also makes its general governing documents available to the

general public upon request


Explanation

AVG HOURS FORM 990 , The following individuals are employees of Lurie Children's and generally work 40 hours per weekWORKED FOR PART VII , Approximately 2 hours of additional time each week is spent providing services to related organizationsRELATED SECTION A, Patrick M Magoon Paula M Noble Edward Ogata, MD Thomas Sullivan Donna S Wetzler Sherwood DORGANIZATIONS LINE 1A Zellermayer The following individual is an employee of the Medical Center and generally works 40 hours

per week Approximately 10 hours of his regular workweek is spent providing services to relatedorganizations James Donaldson, MD The following individuals are employees of Pediatric FacultyFoundation and generally work 40 hours per week Approximately 2 hours of additional time each week isspent providing services to related organizations Thomas P Green, MD Mary J C Hendrix , PhD H WilliamSchnaper , MD OTHER CHANGES IN NET ASSETS OR FUND BALANCES Net unrealized gains oninvestments 26,883 , 315 Grants released from restrictions 1,914,607 Other (restricted ) (2,632 ,407) Pledgereceivable write-offs (2,413 ,997) Pension adjustment (35,763, 062) Founders' Board activities 253,674Change in fair value of perpetual trusts 860,224 ---------- (10,897,646 ) ---------- FORM 990 , SCHEDULE BCONTRIBUTION FROM FOUNDATION $5 4 million was included as a net asset transfer from the Foundationto the Hospital to be used for the New Hospital Project and was primarily raised from the Gala BenefitThis transfer appears on the Foundation 990 return as a Grant to the Hospital and appears on the Hospitalreturn as a Contribution from the Foundation


Explanation

Tax-exempt Form 990 Line A Illinois Finance Authority Revenue Bonds, Series 2008A and Series 2008B (THE CHILDREN'S MEMORIALBonds Schedule K HOSPITAL, AS BORROWER) The proceeds of the sale of the series 2008A/B Bonds were used to (i) Pay orDescription Part I reimburse the payment of a portion of the costs of acquiring, constructing and equipping THE CHILDREN'Sof Purpose MEMORIAL HOSPITAL, (u) pay a portion of the interest on the Series 2008A and Series 2008B Bonds during the

construction period, (vi) fund a debt service reserve fund for the Series 2008B Bonds, and (iv) pay certainexpenses incurred in connection with the issuance of the Series 2008A and Series 2008B Bonds Line B IllinoisFinance Authority Revenue Bonds, Series 2008C and Series 2008D (THE CHILDREN'S MEMORIAL HOSPITAL, ASBORROWER) The proceeds of the Series 2008C and Series 2008D bonds were used to (i) refund the outstandingprincipal amount of the Issuer's Series 1999B-1 Bonds (issued 9/1/99), the Series 1999B-2 Bonds (issued9/1/99), the Series 2003A Bonds (issued 11/18/03), the Series 2003B Bonds (issued 11/18/03) and the Series2004 Bonds (issued 4/14/04) and, (u) pay certain expenses incurred in connection with the issuance of the Series2008C and Series 2008D Bonds Line C Illinois Finance Authority Revenue Bonds, Series 2012A and Series2012B Bonds (Ann & Robert H Lurie Children's Hospital of Chicago) Proceeds of the Series 2012A and Series2012B Bonds were used (i) pay, reimburse, or refinancing taxable debt incurred to pay a portion of the costs ofconstructing and equipping the Ann & Robert H Lurie Children's Hospital of Chicago and pay certain expensesincurred in connection with the issuance of the Series 2012A Bonds and the Series 2012B Bonds Form 990Schedule K Part II Line 3 Column A The amount of $383,720,219 reported in Part I Line 3 includes total issueproceeds of $377,043,130 and investment income of $6,677,089 Column B The amount of $173,514,604 reportedin Part I Line 3, includes total issue proceeds of $173,513,033 and investment income of $1,571 Form 990Schedule K Part II Line 9 Column B These funds were used for noncapitalized interest payments

jefile GRAPHIC print - DO NOT PROCESS

SCHEDULE R(Form 990)

Department of the Treasury

Internal Revenue Service

As Filed Data -

Related Organizations and Unrelated Partnerships

1- Complete if the organization answered "Yes" to Form 990, Part IV, line 33, 34, 35, 36, or 37.1- Attach to Form 990. 1- See separate instructions.

DLN:93493192007243

OMB No 1545-0047

2011


Identification of Disregarded Entities (Complete if the organization answered "Yes" on Form 990, Part IV, line 33.)

(a)Name, address, and EIN of disregarded entity

(b)Primary activity

(c)Legal domicile (stateor foreign country)

(d )Total income

( e)End-of-year assets

(f)Direct controlling

entity

Identification of Related Tax-Exempt Organizations (Complete if the organization answered "Yes" on Form 990, Part IV, line 34 because it had oneor more related tax-exempt organizations during the tax year.)

(g)(a) (b) (c) (d ) (e) (f) Section 512(b)(13)

Name, address, and EIN of related organization Primary activity Legal domicile (state Exempt Code section Public charity status Direct controlling controlledor foreign country) (if section 501(c)(3)) entity organization

Yes No

(1) LURIE CHILDREN'S HOSP OF CHIC RSCH CTR

225 E CHICAGO AVERESEARCH IL 501(C)(3) 4

Medical CtrNo

Chicago, IL 6061136-3357005

(2) LURIE CHILDREN'S HOSPITAL OF CHICAGO FDN

225 E CHICAGO AVEFUNDRAISING IL 501(C)(3) 7

Medical CtrNo

Chicago, IL 6061136-3357006

(3) CHILDREN'S HOSPITAL OF CHICAGO MED CTR

225 E CHICAGO AVEHEALTH CARE IL 501(C)(3) 11 III-FI NA No

Chicago, IL 6061136-3357004

(4) Pediatric Faculty Foundation Inc

225 E CHICAGO AVEHLTH CRE/RSCH IL 501(C)(3) 11 III-FI

Medical CtrNo

Chicago, IL 6061136-3279680

(5) CMH Self Insurance Foundation

225 E CHICAGO AVEINSURANCE IL 501(C)(3) 11 III-FI

MEDICAL CTRNo

Chicago, IL 6061136-6638400

(6) MCGAW MEDICAL CTR OF NORTHWESTERN UNIV

645 NORTH MICHIGAN AVE 1058SUPPORTNG ORG IL 501(C)(3) 11 III-FI NA No

CHICAGO, IL 6061136-2656113

For Privacy Act and Paperwork Reduction Act Notice, see the Instructions for Form 990. Cat No 50135Y Schedule R (Form 990) 2011

Schedule R (Form 990) 2011 Page 2

Identification of Related Organizations Taxable as a Partnership (Complete if the organization answered "Yes" on Form 990, Part IV, line 34because it had one or more related organizations treated as a partnership during the tax year.)

(a)Name, address, and EIN

ofrelated organization

(b)Primary activity

(c)Legal

domicile

(state or

foreign

country)

(d)Direct controlling

entity

(e)Predominant income(related, unrelated,excluded from taxunder sections 512-

514)

(f)Share of total

income

(g)Share of end-of-

yearassets

(h)Disproprtionateallocations7

(i)Code V-UBI

amount in box 20 ofSchedule K-1(Form 1065)

U)General ormanagingpart ner?

(k)Percentageownership

Yes N. Yes N.

Identification of Related Organizations Taxable as a Corporation or Trust (Complete if the organization answered "Yes" on Form 990, Part IV,line 34 because it had one or more related organizations treated as a corporation or trust during the tax year.)

(a)Name, address, and EIN of related organization

(b)

Primary activity

(c)Legal domicile

(state orforeigncountry)

(d )Direct controlling

entity

(e)Type of entity(C corp, S corp,

or trust)

Share(oftotalincome

(g)Share of

end-of-yearassets

(h)Percentageownership

(1) CMMC Insurance Co LTD225 E CHICAGO AVECHICAGO, IL 60611000000000

SELF INSURANCE CJMEDICAL CTR

CORPORATION

Schedule R (Form 990) 2011


Transactions With Related Organizations (Complete if the organization answered "Yes" on Form 990, Part IV, line 34, 35, 35A, or 36.)

Note . Complete line 1 if any entity is listed in Parts II, III or IV Yes No

1 During the tax year, did the orgranization engage in any of the following transactions with one or more related organizations listed in Parts II-IV?

a Receipt of (i) interest (ii) annuities (iii) royalties (iv) rent from a controlled entity la No

b Gift, grant, or capital contribution to related organization( s) lb Yes

c Gift, grant, or capital contribution from related organization( s) lc Yes

d Loans or loan guarantees to or for related organization( s) ld No

e Loans or loan guarantees by related organization (s) le No

f Sale of assets to related organization( s) if No

g Purchase of assets from related organization( s) lg No

h Exchange of assets with related organization( s) lh No

Yesi Lease of facilities, equipment, or other assets to related organization(s) ii

j Lease of facilities, equipment, or other assets from related organization( s) 1j No

k Performance of services or membership or fundraising solicitations for related organization (s) lk No

I Performance of services or membership or fundraising solicitations by related organization( s) 11 No

m Sharing of facilities, equipment, mailing lists, or other assets with related organization( s) lm No

n Sharing of paid employees with related organization( s) in No

o Reimbursement paid to related organization(s) for expenses

p Reimbursement paid by related organization(s) for expenses

q Other transfer of cash or property to related organization( s) lq No

r Other transfer of cash or property from related organization( s) lr No

2 If the answer to any of the above is "Yes," see the instructions for information on who must complete this line, including covered relationships and transaction thresholds

(a)Name of other organization

(b)Transactiontype(a-r)

(^)Amount involved

(d)Method of determining amountinvolved

(1)

(2)

(3)

(4)

(5)

(6)



Unrelated Organizations Taxable as a Partnership (Complete if the organization answered "Yes" on Form 990, Part IV, line 37.)

Provide the following information for each entity taxed as a partnership through which the organization conducted more than five percent of its activities (measured by total assets or grossrevenue) that was not a related organization See instructions regarding exclusion for certain investment partnerships

(a)Name, address, and EIN of

entity

(b)Primary activity

(c)Legal domicile

(state orforeigncountry)

(d)Predominant

income(related,unrelated,

excluded fromtax under

sections 512-514

(e)Are allpartnerssection

501(c)(3)organizations?

(f)Share of

total income

(g)Share of

end-of-yearassets

(h)Disproprtionate allocations?

(i)Code V-UBIamount in box

20 of Schedule K-1(Form 1065)

U)General ormanagingpart ner?

(k)Percentageownership

)Yes No Yes No Yes No




Complete this part to provide additional information for responses to questions on Schedule R (see instructions)



Additional Data

Software ID:

Software Version:

EIN: 36-2170833


Form 990, Schedule R, Part II - Identification of Related Tax-Exempt Organizations

(c) (e) g(a) Legal (d) Public (f) Section 512

(b)Name, address, and EIN of related Domicile Exempt Code charity Direct (b)(13)organization

Primary Activity(State section status Controlling controlled

or Foreign (if501(c) Entity organizationCountry) (3))

LURIE CHILDREN'S HOSP OF CHICRSCH CTR

501(C) Medical Ctr225 E CHICAGO AVE

RESEARCH IL(3)

4No

Chicago, IL 6061136-3357005

LURIE CHILDREN'S HOSPITAL OFCHICAGO FDN

501(C) Medical Ctr225 E CHICAGO AVE

FUNDRAISING IL(3)

7No

Chicago, IL 6061136-3357006

CHILDREN'S HOSPITAL OF CHICAGOMED CTR

501 0 )(NA

225 E CHICAGO AVEHEALTH CARE IL

( )3

11 III-FI No

Chicago, IL 6061136-3357004

Pediatric Faculty Foundation Inc

501 0 ) Medical Ctr225 E CHICAGO AVE HLTH CRE/RSCH IL 11 III-FI No

)(3

Chicago, IL 6061136-3279680

CMH Self Insurance Foundation

501 0 ) MEDICAL CTR225 E CHICAGO AVE INSURANCE IL

)(3 11 III-FI No

Chicago, IL 6061136-6638400

MCGAW MEDICAL CTR OFNORTHWESTERN UNIV

501 ( 0 )NA

645 NORTH MICHIGAN AVE 1058SUPPORTNG ORG IL

( )3

11 III FI No

CHICAGO, IL 6061136-2656113

Return to Form

Children's Hospital of ChicagoMedical Center and AffiliatedCorporationsConsolidated Financial StatementsAugust 31, 2012 and 2011

Children's Hospital of Chicago Medical Center and AffiliatedCorporationsIndexAugust 31, 2012 and 2011

Report of Independent Auditors

Consolidated Financial Statements

Consolidated Balance Sheets

Consolidated Statements of Operations and Changes in Net Assets

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements


Consolidating Balance Sheet

Page(s)

1

2

3-4

5

6-34

35-36

Consolidating Statement of Operations and Changes in Unrestricted Net Assets 37

pwc

Report of Independent Auditors

To the Board of Directors of

Children's Hospital of Chicago Medical Center

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of

operations and changes in net assets and of cash flows present fairly, in all material respects, the financial

position of Children's Hospital of Chicago Medical Center and its subsidiaries (the `Medical Center') at

August 31, 2012 and 2011, and the results of their operations and their cash flows for the years then

ended in conformity with accounting principles generally accepted in the United States of America These

financial statements are the responsibility of the Medical Center's management Our responsibility is to

express an opinion on these financial statements based on our audits We conducted our audits of these

statements in accordance with auditing standards generally accepted in the United States of America

Those standards require that we plan and perform the audits 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, assessing the

accounting principles used and significant estimates made by management, and evaluating the overall

financial statement presentation We believe that our audits provide a reasonable basis for our opinion

Our audits were conducted for the purpose of forming an opinion on the consolidated financial statements

taken as a whole The consolidating information on pages 35-37 is presented for purposes of additional

analysis of the consolidated financial statements rather than to present the financial position and results of

operations of the individual entities Accordingly, we do not express an opinion on the financial position

and results of operations of the individual entities However, the consolidating information has been

subjected to the auditing procedures applied in the audit of the consolidated financial statements, and in

our opinion, is fairly stated in all material respects in relation to the consolidated financial statements taken

as a whole

u .w L L

December 5, 2012

PricewnterhouseCoopeis LLP, One North Wacker, Chicago, IL 60606T: (312) 298 2000, F: (312) 298 2001, www.pwc.com/us

Children's Hospital of Chicago Medical Center and AffiliatedCorporationsConsolidated Balance SheetsAugust 31, 2012 and 2011

2012 2011

AssetsCurrent assets

Cash and cash equivalents $ 20,602,291 $ 18,274,095

Current portion of self-insurance trust 28,500,000 12,600,000

Accounts receivable, net of allowance for

uncollectible accounts of $11,155,000 and

$8,792,000 in 2012 and 2011, respectively 112,723,462 33,220,474

Other current assets 53,132,133 42,652,669

Total current assets 214,957,886 106,747,238

Investments 866,501,915 984,502,360

Property and equipment, at cost

Land 42,280,998 42,280,998

Buildings and improvements 1,098,308,777 344,481,903

Equipment 263,980,677 277,028,256

Construction in progress 14,723,502 719,191,260

Total property and equipment, at cost 1,419,293,954 1,382,982,417

Less Accumulated depreciation 357,351,780 508,573,282

Propertyand equipment, net 1 ,061 ,942,174 874,409,135

Other assets

Pledges receivable restricted bydonors, net 91,471,095 95,284,016

Unamortized bond issuance costs 8,643,412 8,659,223

Other 20,061,247 18,307,540

Total other assets 120,175,754 122,250,779

Total assets $2,263,577,729 $2,087,909,512

Liabilities and Net Assets

Current liabilities

Accounts payable and accrued expenses $ 166,142,330 $ 113,773,948

Current portion of self-insurance liability 28,500,000 12,600,000

Due to third-partypayors 11,715,904 5,234,793

Total current liabilities 206,358,234 131,608,741

Other liabilities

Self-insurance liability 74,270,343 92,742,973

Other noncurrent liabilities 74,242,196 21,695,616

Total other liabilities 148,512,539 114,438,589

Long-term debt 563,987,751 565,962,183

Total liabilities 918,858,524 812,009,513

Commitments and contingencies

Net assets

Unrestricted 1,006,616,377 745,225,923

Tern poranly restricted 195,155,061 390,048,649

Perm anently restricted 142,947,767 140,625,427

Total net assets 1,344,719,205 1,275,899,999

Total liabilities and net assets $2,263,577,729 $2,087,909,512

The accompanying notes are an integral part of these consolidated financial statements

2

Children's Hospital of Chicago Medical Center and AffiliatedCorporationsConsolidated Statements of Operations and Changes in Net AssetsYears Ended August 31, 2012 and 2011

2012 2011

Operating revenue

Net patient service revenue

Net assets released from restrictions

Contributions and philanthropy used for program purposes

Grants and other restricted income used for program purposes

Board-designated endowment income

Other operating revenue

Total operating revenue

Operating expenses

Salaries, wages, and employee benefits

Supplies and services

Depreciation

Provision for bad debts

Total operating expenses

Income from operations before interest and amortization

Interest and amortization of financing costs

Income from operations

Nonoperating income (expense)

Investment return

Unrestricted contributions and bequests

Fund-raising expense

Other general purpose releases from restrictions

Unrestricted net assets redesignated bythe donors from

temporanlyand permanently restricted net assets

Other

Total nonoperating income

Excess of revenue over expenses

$ 608,795,590 $ 564,349,456

22,813,068 21,854,821

38,317,163 38,243,716

4,063,890 4,761,810

47,798,076 33,650,449

721,787,787 662,860,252

400,697,375 376 ,588,168

232,794,300 204,380,134

44,812,808

9,177,365

42,115,266

7,149,732

687,481,848 630,233,300

34,305,939

8,541,378

32,626,952

4,593,041

7F 7R4 FR1 7R nii c111

39,194,165 59,844,582

20,283,359 19,433,135

(19,517,468) (14,758,078)

7,500,000 7,500,000

38,446,842

(1,315,169) (6,041,810)

AR 1 dd RR7 1 (ld d7d R71

R 71 91)9 44R R 1 S 9 45,9 5R9


3

Children's Hospital of Chicago Medical Center and AffiliatedCorporationsConsolidated Statements of Operations and Changes in Net AssetsYears Ended August 31, 2012 and 2011

2012 2011

Unrestricted net assets

Excess of revenue over expenses $ 71,909,448 $ 132,458,582

Net assets released from restrictions used for purchase of

and construction of property and equipment 224,937,859 666,427

Retirement plan - related change other than net periodic

retirement plan expense (35,763,062) 14,000,336

Other 306,209 306,425

Increase in unrestricted net assets 261 ,390,454 147,431,770

Temporarily restricted net assets

Contributions 52,316,890 41,003,890

Grants and other restricted income 39,997,292 39,522,324

Investment return 8,882 ,547 16,053,907

Pledge receivable write-offs, net of change in allowance (2,413,997) )(1,591,361

Net assets released from restrictions

Contributions and philanthropy used for program purposes (22,813,068) (21,854,821)

Grants and other restricted income used for program purposes (38,317,163) (38,243,716)

Other general purpose releases (7,500,000) (7,500,000)

Purchase of propertyand equipment (224,937,859) (666,427)

Transfers (61,671) )(1,057,281

Temporarily restricted net assets redesignated bythe donors

to unrestricted net assets - (11,276,088)

Other (46,559) (242,013)

(Decrease ) increase in temporarily restricted netassets (194,893,588) 14,148,414

Permanently restricted net assets

Contributions 1,353,886 3,114,183

Change in fair value of perpetual trusts 860,224 2,423,336

Transfers 61,671 1,057,281

Permanently restricted net assets redesignated by

the donors to unrestricted net assets - (27,170,754)

Other 46,559 241,194

Increase ( decrease ) in permanently restricted net assets 2 ,322,340 (20,334,760)

Increase in netassets 68,819 ,206 141,245,424

Net assets

Beginning of year 1,275,899,999 1,134,654,575

End of year $1,344,719,205 $1,275,899,999


4

Children's Hospital of Chicago Medical Center and AffiliatedCorporationsConsolidated Statements of Cash FlowsYears Ended August 31, 2012 and 2011

2012 2011

Cash flows from operating activities

Increase in net assets $ 68,819,206 $ 141,245,424Adjustments to reconcile change in net assets to net cash

provided by operating activities

Realized and unrealized gains on investments (39,194,165) (59,844,582)

Restricted contributions and restricted investment return (42,193,994) (50,217,922)

Receipt of contributed securities (3,893,224) (3,283,516)

Retirement plan - related change other than net periodicretirement plan expense 35 ,763,062 (14,000,336)

Depreciation and amortization 45,534,071 42,606,546

Provision for bad debts 9,177,365 7,149,732

Net changes in assets and liabilities

Accounts receivable , net (88,680 ,353) (13,166,875)

Accounts payable and accrued expenses 17,367,443 (4,652,900)

Due to third-party payors 6,481,111 (5,691,981)

Self-insurance liability (2,572,630) 2,734,321

Other assets and liabilities 7,468,609 8,770,795

Net cash provided by operating activities 14,076,501 51,648,706

Cash flows from investing activities

Capital expenditures (197,508,071) (226,544,272)

Sale of investments 652,799,583 990,378,300

Purchases of investments (499,278,252) (838,519,218)

Net cash used in investing activities (43,986,740) (74,685,190)

Cash flows from financing activities

Principal payments under long-term debt obligations (114,100,000) -

Proceeds from long-term debt financing 112,000,000 -

Debt issuance costs 473,444 -

Proceeds from restricted contributions and

restricted investment income 33,864,991 33,334,961

Net cash provided by financing acti\nties 32,238,435 33,334,961

Increase in cash and cash equivalents 2,328,196 10,298,477

Cash and cash equivalents

Beginning of year 18,274,095 7,975,618

End of year $ 20,602,291 $ 18,274,095

Supplemental disclosures of cash flow information

Cash paid during the year for interest, net of amounts capitalized $ 4,987,000 $ 1,367,000

Noncash additions to property and equipment 47,793,000 12,793,000


5

Children's Hospital of Chicago Medical Center and AffiliatedCorporationsNotes to Consolidated Financial StatementsAugust 31, 2012 and 2011

Organization and Nature of Operations

Children's Hospital of Chicago Medical Center, formerly Children's Memorial Medical Center (the`Medical Center'), an Illinois not-for-profit corporation, is the sole member of Ann & Robert H LurieChildren's Hospital of Chicago (the `Hospital'), formerly Children's Memorial Hospital, a not-for-profit corporation The Hospital, the first member of the Medical Center, was founded in 1882 byJulia Foster Porter to provide medical care for all children Today, the Medical Center remains anindependent, freestanding academic institution dedicated to the health and well being of allchildren The Medical Center is also the sole member of Ann & Robert H Lurie Children's Hospitalof Chicago Research Center ('Research Center'), formerly Children's Memorial Research Center,Ann & Robert H Lurie Children's Hospital of Chicago Foundation, Inc (the `Foundation'), formerlyChildren's Memorial Foundation, and the Pediatric Faculty Foundation, Inc ('PFF'), all Illinois notfor-profit corporations Lurie Children's Medical Group, LLC ('LCMG'), formerly Children'sMemorial Medical Group, a controlled affiliate of the Medical Center, is an Illinois limited liabilitycompany The Medical Center is also the parent of CMMC Insurance Co Ltd ('CMMC Insurance'),a captive, offshore insurance entity It is an organization described under the laws of the CaymanIslands

The Hospital owns and operates a pediatric hospital with a licensed capacity of 288 beds inChicago, Illinois The Hospital provides a complete range of pediatric health services, includingpediatric inpatient medical and surgical care, tertiary care services, and emergency services TheHospital also operates more than 50 specialty and primary care outpatient clinics at its maincampus in the Streeterville neighborhood and other Chicago area locations, as well as twoambulatory care facilities and five outpatient specialty centers

The Research Center was established to improve pediatric health and health services throughresearch and education The Foundation carries out fund-raising and other related developmentactivities in support of the Medical Center and its affiliated corporations

PFF provides physician services to a broad pediatric population in Chicago, surrounding counties,and across the State of Illinois and totals more than 370 pediatric care and subspecialty physiciansLCMG provides professional pathology, medical imaging , psychiatry , and dentistry services to theHospital and its patients with more than 50 employed physicians

CMMC Insurance is a captive, offshore insurance entity whose sole function is to purchasereinsurance for the purpose of reducing risk and costs It does not retain risk CMMC Insurancehas no employees and is managed on behalf of the Hospital by an independent Cayman Islands-based management company

In April 2008, construction began on the Ann & Robert H Lurie Children's Hospital of Chicago,which opened in June 2012 The Medical Center issued $380,000,000 of debt in May of 2008(Note 9) primarily to support the project, with the remaining funding sources coming fromphilanthropy and hospital equity included in the board designated new hospital planning fund Asof August 31, 2012, total commitments on the project were approximately $839,631,000, of whichapproximately $779,129,000 has been expended

The old Lincoln Park Facility was closed as of June 2012 and is currently being decommissionedand prepared to be sold in the upcoming year

6


Consolidation

The accompanying consolidated financial statements of the Medical Center include the accounts ofthe Medical Center, the Hospital, the Research Center, the Foundation, PFF, LCMG, and CMMCInsurance Intercompany transactions and accounts have been eliminated

Summary of Significant Accounting Policies

New Accounting Pronouncements

In August 2010, the Financial Accounting Standards Board ("FASB") updated guidance forhealthcare entities regarding the presentation of insurance claims and related recoveries Theamendments in this update clarify that a healthcare entity should not net insurance recoveriesagainst a related claim liability Additionally, the amount of the claim liability should be determinedwithout consideration of insurance recoveries This update was adopted as of August 31, 2011(refer to Note 11)

In August 2010, the FASB issued ASU 2010-23, Measuring Charity Care for Disclosure(ASU 2010-23) The provisions of ASU 2010-23 are intended to reduce the diversity in how charitycare is calculated and disclosed across healthcare entities that provide it Charity care is requiredto be measured at cost, defined as the direct and indirect costs of providing the charity careFunds received to offset or subsidize the cost of charity care provided, for example from gifts orgrants restricted for charity care, should be separately disclosed As a healthcare entity does notrecognize revenue when charity care is provided, this update will only require enhanceddisclosures and will have no effect on the statements of operations and changes in net assetsThis new guidance is effective for fiscal years beginning after December 15, 2010, withretrospective application required and with early application permitted The Medical Centeradopted this guidance as of August 31, 2012

In June 2011, the FASB Emerging Issues Task Force amended guidance for healthcare entitiesregarding the presentation and disclosure of the provision for bad debts and the allowance fordoubtful accounts The amendments in this update require certain healthcare entities to changethe presentation of their statement of operations by reclassifying the provision for bad debtsassociated with patient service revenue from an operating expense to a deduction from patientservice revenue Additionally, healthcare entities are required to provide enhanced disclosureabout the policies for recognizing revenue, assessing bad debts, and qualitative and quantitativeinformation about changes in the allowance for doubtful accounts This update will be effective forthe Medical Center as of August 31, 2013 The updated guidance is not expected to have amaterial impact on the Medical Center's financial statements

7


Use of Estimates

The preparation of financial statements in conformity with accounting principles generally acceptedin the United States of America requires management of the Medical Center to make assumptions,estimates, and judgments that affect the amounts reported in the consolidated financial statements,including the notes thereto, and related disclosures of commitments and contingencies, if any TheMedical Center considers critical accounting policies to be those that require more significantjudgments and estimates in the preparation of its consolidated financial statements, including thefollowing recognition of net patient service revenue, which includes contractual allowances andthird-party payor settlements, provisions for bad debt, reserves for losses and expenses related tohealth care professional and general liabilities, valuation of alternative investments, and risks andassumptions for measurement of pension liabilities Management relies on historical experience,on other assumptions believed to be reasonable under the circumstances, and recommendationsmade by the Medical Center external advisors and actuaries in making its judgments andestimates Actual results could differ from those estimates

Cash and Cash Equivalents

Cash and cash equivalents include unrestricted, undesignated marketable securities with originalmaturities of three months or less that are held for short-term cash management Cash and cashequivalents are reported at their approximate fair value

Other Current Assets

Other current assets for fiscal year 2012 and 2011 are as follows

2012 2011

Outreach Hospitals and Practice Plan Receivables $ 12,100,927 $ 6,219,343

Prepaids 11,873,201 7,692,432

Inventory 5,866,553 4,027,088

Insurance recoverables 14,459,495 10,578,392

Other 8,831,957 14,135,414

Total other current assets $ 53,132,133 $ 42,652,669

Investments

The Medical Center pools its donor restricted, self-insurance, and undesignated and board-designated investments Investment returns are allocated among unrestricted, temporarilyrestricted, and permanently restricted net assets based on the pro-rata share of the balances ineach fund to the total investment pool

Investment income earned, at a fixed rate, on certain funds that are board-designated for patientcare and education and on self-insurance trust assets is reported as other operating revenue Allother investment income and losses (including interest and dividends, realized gains and losses,and unrealized gains and losses) are reported as nonoperating income (loss) unless the income orloss is restricted by donor or law Investment returns on permanently restricted net assets areallocated to the purposes specified by the donor or state law, either as temporarily restricted orunrestricted, as applicable

8


Fair Value of Financial Instruments

Financial instruments consist primarily of cash and cash equivalents, investments, accountsreceivable, pledges receivable, accounts payable, accrued expenses, estimated third party payorsettlements, and long-term debt Except as otherwise disclosed, the fair value of financialinstruments approximates their financial statement carrying amount

Inventories

Inventories, which primarily consist of medical supplies and pharmaceuticals used for patient care,are stated at the lower of cost (first-in, first-out) or market value

Property and Equipment

Property and equipment is recorded at cost Depreciation is calculated using the straight-linemethod over the estimated useful lives of the assets One-half year's depreciation is taken in theyear of acquisition, except for the new hospital project which is being depreciated based on theactual date placed into service The useful lives of the major asset classifications are as follows

Buildings

Building improvements

Equipment

Computer hardware and software

40-80 years

15-20 years

5-20 years

3-5 years

In 2012 and 2011, The Medical Center disposed of approximately $196,193,000 and $112,000,respectively, of fully depreciated equipment and software that was no longer in use

The Medical Center continually evaluates whether circumstances have occurred that wouldindicate the remaining estimated useful life of long-lived assets may warrant revision or that theremaining balance of such assets may not be recoverable When factors indicate that such assetsshould be evaluated for possible impairment, the Medical Center uses an estimate of theundiscounted cash flows over the remaining life of the asset in measuring whether the asset isrecoverable

In connection with the selection of the new hospital site, the useful lives of the existing assets wereevaluated for impairment While no impairment adjustment was deemed necessary, the MedicalCenter has been recognizing accelerated depreciation compared to original estimates overreduced estimated useful lives to fully depreciate the buildings, leasehold improvements, andequipment which were not utilized by the Hospital During the years ended August 31, 2012 and2011, the Medical Center recognized $7,615,000 and $6,906,000, respectively, of accelerateddepreciation on these assets

In 2012 and 2011, the Medical Center capitalized net interest expense of $16,736,000 and$20,130,000, respectively, in connection with the new hospital project

9


Pledges Restricted by Donors

As of August 31, 2012, approximately 41 % of pledges restricted by donors are receivable withinone year , 53% between two and five years, and 6% receivable beyond five years Pledges arerecorded at present value of their estimated future cash flow , net of allowances for uncollectiblepledges of approximately $2,422,000 and $1 ,411,000 at August 31, 2012 and 2011 , respectively,and present value discounts of approximately $13,462,000 and $11 ,582,000 at August 31, 2012and 2011 , respectively Estimated future cash flows due after one year are discounted usinginterest rates ranging from 5% to 6% commensurate with estimated collection risks

Unamortized Bond Issuance Costs

Bond issuance costs are deferred and amortized using the effective interest method over the life ofthe related debt

Self-Insurance Trust

The self-insurance trust is reviewed annually by an independent actuary The Medical Centercontributes to the self-insurance trust amounts determined by the actuary to be sufficient to pay forexpected future losses Accruals related to the estimated self-insurance liability and thecorresponding charge to expense are based on management's analysis of asserted andunasserted claims and management utilizes the actuary to assist in assessing these liabilities

Other Noncurrent Liabilities

Other noncurrent liabilities for fiscal year 2012 and 2011 are as follows

2012 2011

Accrued pension liabilities

Lease obligations

Other

Total other noncurrent liabilities

$ 60,138, 618 $ 17, 772, 947

10, 599, 923 494,100

3,503,656 3,428,569

$ 74,242,196 $ 21,695,616

Net Assets

Net assets are classified based upon donor restrictions, if any, as follows

UnrestrictedNet assets which are free of donor-imposed restrictions, all revenue, expenses, gains, and lossesthat are not changes in permanently or temporarily restricted net assets

Temporarily RestrictedNet assets whose use is limited by donor-imposed stipulations that expire with the passage of time,that are restricted based on state laws or that can be fulfilled or otherwise removed by actions ofthe Medical Center pursuant to those stipulations

Temporarily restricted net assets held outside the endowment fund primarily relate to pledgesreceivable, grants, program support and new hospital funds

Permanently RestrictedNet assets whose use is limited by donor-imposed stipulations that neither expire with the passageof time nor can be fulfilled or otherwise removed by actions of the Medical Center

10


During fiscal year 2012, $224,938,000 of temporarily restricted funds were released to unrestrictednet assets as a result of the completion of the new hospital consistent with the donor's intentDuring fiscal year 2011, $38,447,000, which includes $27,170,000 of restricted endowments,$9,781, 000 of related earnings and $1 ,496,000 of appropriated spend rate allocation, were re-designated to unrestricted as a result of the donors releasing the original restrictions TheExecutive Board of the Hospital authorized the funds to be designated for a purpose consistentwith the interests of the respective donors

Refer to Note 6 for further disclosure on endowments and related investment and spendingpolicies

Net Patient Service Revenue

Substantially all of the Medical Center's net patient service revenue in fiscal 2012 and 2011 wasderived from third-party payors that provide for payments to the Medical Center at amountsdifferent from its established rates Payment arrangements include reimbursed costs (ascontractually defined), discounted charges, and per diem payments Reimbursement from certainprograms is subject to audit Settlements under these programs are accrued on an estimatedbasis in the period the related services are rendered and adjusted in subsequent periods as finalsettlements are determined Provision is made on a current basis for the difference betweencharges for services rendered and the expected payments under these agreements and programsand are adjusted in future periods as final settlements are determined As a result of the complexlaws and regulations governing third-party payor programs, there is at least a reasonable possibilitythat recorded estimates will change by a material amount in the near term

Approximately 32% and 33% of the Medical Center's net patient service revenue in fiscal 2012 and2011, respectively, was derived from the Illinois Medicaid program

In December 2008, the Centers for Medicare and Medicaid Services approved the Illinois HospitalAssessment Program to improve Medicaid reimbursement for Illinois hospitals The ProviderAssessment and Medicaid Program payments are in effect for the state fiscal years endedJune 30, 2009 through December 31, 2014 During the year ended August 31, 2012, the MedicalCenter recorded a net benefit of $21,193,000, of which $17,661,000 related to state fiscal year2012 and $3,532,000 related to state fiscal year 2013 Due to the tax assessment provisionscontained in the legislation, implementation of the program affected both operating revenues andexpenses in the consolidated statement of operations and changes in net assets For the yearsended August 31, 2012 and 2011, the Medicaid payment of $34,922,000 was included in netpatient service revenue and the tax assessment of $13,729,000 was included in supplies andservices expense The amount of disproportionate share and other special payments fromMedicaid, if any, that will be made to hospitals in the future, is uncertain The absence of suchpayments could have a material adverse effect on the Medical Center's operating results

In fiscal 2012 and 2011, the Medical Center received approximately $8,399,000 and $7,898,000,respectively, in graduate medical education reimbursement This Children's Hospital GraduateMedical Education ('CHGME') program provides federal funds to freestanding children's hospitalsto help them maintain graduate medical programs that train resident physicians The program isadministered by the HealthCare Resource Service Administration, a branch of the U S Departmentof Health and Human Services The amount of future graduate medical education reimbursementfunding that will be made to children's hospitals is uncertain

11


Statement of Operations

All activities of the Medical Center deemed by management to be ongoing, major and central to theprovision of healthcare services are reported as operating revenues and expenses Other activitiesdeemed to be nonoperating include, unrestricted gifts, fundraising expenses and certain investmentincome (including realized gains and losses)

The Medical Center recognizes changes in accounting estimates related to patient service revenuereserves and third -party payor settlements as more experience is acquired Adjustments to prioryear estimates for these items resulted in an increase in net patient service revenues ofapproximately $1,781, 000 in fiscal year 2012 In fiscal year 2011 , the adjustments resulted in anincrease in net patient service revenue of approximately $8,500,000 and a reduction for theprovision for bad debts of $2,000,000

The consolidated statements of operations and changes in net assets include excess of revenueover expenses Changes in unrestricted net assets, which are excluded from the excess ofrevenue over expenses , consistent with industry practice, include contributions of (and assetsreleased from restrictions for purposes of acquiring) long-lived assets , and pension benefit changesother than net periodic expense

Grants and Contributions

Unrestricted contributions are included in nonoperating income (expense) when receivedUnrestricted pledges of amounts to be received in future periods are recorded as temporarilyrestricted net assets and reflected as changes in unrestricted net assets when received Grantsand contributions restricted for a specific operating purpose are recorded as temporarily restrictednet assets and reflected in unrestricted revenue when the funds are expended in accordance withthe specifications of the grantor or donor Contributions for capital expenditures, recorded astemporarily restricted net assets when received, are recorded as net assets released fromrestrictions when expended and placed into service

Interest in Trustee-Held Funds

The Hospital recognizes an interest in trustee-held funds held at various financial institutions inwhich the Hospital has a beneficial interest Annually, the financial institutions distribute a portionof the income earned on these funds to the Hospital to be used in support of operations AtAugust 31, 2012 and 2011, the Hospital's interests in these trustee-held funds at fair value totaledapproximately $25,364,000 and $24,504,000, respectively, and are included in permanentlyrestricted net assets The change in fair value of these funds amounted to a gain of $860,000 and$2,423,000, for the years ended August 31, 2012 and 2011, respectively, and is included inpermanently restricted net assets

Income Taxes

The Internal Revenue Service has determined that the Medical Center, the Hospital, the ResearchCenter, the Foundation, and PFF are all not-for-profit organizations under Section 501(c) (3) of theInternal Revenue Code (the `Code') and are exempt from federal income taxes on related incomeLCMG is described as a disregarded entity and is treated as a branch or division of the MedicalCenter Therefore, financial and other information applicable to LCMG is reported under theMedical Center

Reclassification

Certain amounts in the 2011 financial statements have been reclassified to conform to the 2012presentation

12


Community Benefit

Consistent with its mission, the Medical Center maintains a policy that sets forth the criteriapursuant to which health care services are provided free of charge or at a reduced rate to childrenwhose families are unable to pay for the charges associated with their medical care Theseservices represent charity care and are not reported as revenue

The Hospital also provides a broad range of services and activities to support its charitablemission These services include the following

• Participation in the Medicaid program at a loss (net reimbursement less allocated costincurred),

• Support of community medical needs through a variety of outreach programs and educationalprograms,

• Comprehensive research programs specifically targeted toward pediatric health to advanceknowledge about the causes, treatment, and prevention of childhood diseases, and

• Training of medical students, pediatric residents, fellows and subspecialists

Funding for these services comes from Hospital income from operations, philanthropy raised by theFoundation, CHGME, and grants The Medical Center has an established charity care policy andmaintains records to identify and monitor the level of charity care it provides These recordsinclude the estimated cost of unreimbursed services provided under its charity care policy and theexcess of cost over reimbursement for Medicaid patients The Medical Center also monitors theunreimbursed cost of patient bad debts Because the Illinois All Kids program provides coveragefor most Illinois uninsured children, the Medical Center has a relatively low number of requests forcharity care

The Medical Center determines the costs associated with providing charity care by aggregating theoverall cost to charge ratio, including salaries, wages, benefits, supplies, and other operatingexpenses, based on data from its financial results The cost to charge ratio is applied to the charitycare charges to calculate the charity care costs amount reported below

13


Costs of unreimbursed charity care and community benefit programs for fiscal 2012 and 2011 areas follows

2012 2011

Excess of allocated cost over reimbursement for services

provided to Medicaid patients

Net benefit under the Illinois Hospital Assessment Program

Excess of allocated cost over reimbursement for services

provided to hospital Medicaid patients, net of net benefit

under the Illinois Hospital Assessment Program

Estimated costs and expenses incurred to provide charity care

Unreimbursed cost of charity care

Estimated cost of patient bad debts

Funds allocated to research from unrestricted funds

Resident and fellows expense

Community clinic support

Child advocacy programs

Family support and interpretation services

Transplant patient family housing

Total cost of unreimbursed chanty care and

community benefit programs

$ 97,023,138 $ 86,158,709

(21.192.658) (21.192.658)

75,830,480 64,966,051

1,163,893 1,235,611

76,994,373 66,201,662

3,487,554 3,648,104

7,138,246 7,078,166

15,369,682 15,493,437

2,948,269 2,882,415

5,495,460 2,644,229

6,525,590 6,605,0201fi9 2nn 1R.9 9n1

$ 118,128,374 $ 104,738,934

The Medical Center also reports community benefits on the IRS Form 990 and the BeneficialActivities for the Property Affidavit As a result of differences in criteria and definitions betweenthese reports the amounts calculated will vary

4. Investments

The Medical Center maintains a diversified asset allocation that places a greater emphasis onequity-based investments to achieve its long-term return objectives within prudent risk constraints

As of August 31, 2012 and 2011, investments consisted of the following, which includes the currentportion of the self-insurance trust of $28,500,000 and $12,600,000, respectively

2012

Short-term investments

Common and preferred stock

Alternative investments

U S Government and agency securities

Corporate and municipal bonds

U S Government guaranteed fixed income

Net receivable (payable) from investments

sold (purchased)

Accrued interest

Total investments

$ 69, 863,113

342,590,375

273, 322, 978

80,196, 051

128,735,336

(631, 598)

925.660

2011

$ 200, 229, 326

309, 432, 278

290,191, 017

76,409,407

118,112,551

2,034,062

(352,286)

1.046.005

$ 895, 001, 915 $ 997,102, 360

14


The decrease in total investments from fiscal 2011 to fiscal 2012 was principally due to plannedcapital expenditures for the construction of the Hospital (Note 1)

Short-term investments include cash and cash equivalents, certificates of deposit, money marketfunds, and securities with short-term maturities

Common and preferred stock includes public equities traded in both domestic and internationalmarkets excluding those investments classified as alternatives

Alternative investments include hedge funds, some publicly traded equities held in limitedpartnerships, and private equity investments These include credit-oriented strategies, multi-strategy funds where the manager has a broad mandate to invest opportunistically, and eventdriven funds where managers seek opportunity in various forms of arbitrage strategies as well as incorporate activities such as mergers and acquisitions The Medical Center's investment in privateequity is committed under contract to periodically advance additional funding as capital calls areexercised (Note 14) At August 31, 2012, $7,650,000 had been advanced against a totalcommitment of $15,000,000

All Medical Center investments are invested with external managers

The Medical Center pools its unrestricted , board -designated and donor- restricted investments Asof August 31, 2012 and 2011 , donor- restricted and unrestricted investments are as follows

2012 2011

Donor - restricted investments and other

assets limited as to use

Project and capital funds

Endowments

Specific purpose

Self-insurance trust

Interest in trustee-held funds

Total restricted investments

Unrestricted investments

Undesignated and board-designated investments

New hospital-unrestricted

Total unrestricted investments

Total investments

$ 14,538,169 $ 14,546,968

116, 839, 879 115, 227, 891

105, 683, 580 92, 319, 643

90,321 , 168 86,444,089

25, 363, 981 24, 503, 757

352.746.777 333.042.348

531,274,218

10,980,920

551,278,674

112,781,338

542,255,138 664,060,012

$ 895, 001, 915 $ 997,102, 360

15


The composition and presentation of investment return as reflected in the accompanyingconsolidated statements of operations and changes in net assets for the years ended August 31,2012 and 2011 are as follows

2012

Unrestricted investment returnInterest and dividend incomeRealized gains (losses) on sales of investmentsUnrealized gains on investmentsAlternative investment gains

Total unrestricted investment return

Reported asBoard-designated endowment incomeOther operating investment return

Nonoperating investment return

Total unrestricted investment return

Temporarily and permanently restricted investment returnInterest and dividend incomeNet realized and unrealized gains on investments

Total restricted investment return

Total investment return

$ 9,170, 879

13, 393, 897

9,915,583,C OOA, 1

$ 4,063,890

5,106,456

48, 364, 511

1,413, 768

9,742,771

2011

$ 9,782,994

(7,673,432)

46, 382,413nn CC4 00,

$ 4,761,810

4,447,464

59,844,582

69, 053, 856

1,594,282

16, 882, 961

18,477, 243

Details on typical redemption terms by asset class and type of investments are provided below

Investments

Short-term in estments


Alternate a in'estments

Remaining Redemption Redemption Restrictions

Life Terms and Terms

N/A

N/A

N/A

U S Government and agency securities N/A

Corporate and municipal bonds N/A

U S Government guaranteed fixed income N/A

Accrued interest N/A

Daily None

Daily to monthly with None

notice periods of

1 to 10 days

Quarterly to annually Lock-up provisions

with varying notice ranging from 0 to 3

penods years, Private Equity

in'estments and a

portion of some hedge

funds are in sidepockets

with no redemptions

permitted

Daily None

Daily None

Daily None

Daily None

16

Redemption

Restrictions in

Place at year end

None

None

Approximately $1 6 million

of in'estments are in

liquidating funds

None

None

None

None


5. Fair Value Measurements

The Medical Center follows the provisions of the Financial Accounting Standards Board (FASB)official pronouncement on Fair Value Measurements for financial instruments The pronouncementestablishes a hierarchy of valuation inputs based on the extent to which the inputs are observable

in the marketplace Observable inputs reflect market data obtained from sources independent ofthe reporting entity and unobservable inputs reflect the entities own assumptions about how marketparticipants would value an asset or liability based on the best information available Valuationtechniques used to measure fair value must maximize the use of observable inputs and minimizethe use of unobservable inputs The standard describes a fair value hierarchy based on threelevels of inputs, of which the first two are considered observable and the last unobservable, thatmay be used to measure fair value

The following describes the hierarchy of inputs used to measure fair value and the primaryvaluation methodologies used by the Medical Center for financial instruments measured at fairvalue on a recurring basis The three levels of inputs are as follows

Level 1 Quoted prices in active markets for identical assets or liabilities

Level 2 Inputs other than Level 1 that are observable , either directly or indirectly , such asquoted prices for similar assets or liabilities, quoted prices in markets that are notactive, or other inputs that are observable or can be corroborated by observable marketdata for substantially the same term of the assets or liabilities

Level 3 Unobservable inputs that are supported by little or no market activity and that aresignificant to the fair value of the assets or liabilities

The financial instrument's categorization within the valuation hierarchy is based upon the lowestlevel of input that is significant to the fair value measurement

The following table presents the investments carried at fair value as of August 31, 2012, by caption,

including the current portion of the self-insurance trust of $28,500,000, by the valuation hierarchydefined above

Assets

Investments







sold (purchased)

Accrued interest

Level 1 Level 2 Level 3 Total

$ 69,863 , 113 $ - $ - $ 69 , 863,113

271,123,469 71, 466,906 - 342,590,375

- 23,252,328 250,070,650 273,322,978

10,804,727 69,391,324 - 80,196,051

17,529, 098 111 ,206,238 - 128,735,336

(631,598 ) - - ( 631,598)

925,660 - 925,660

Total assets at fair value $368,688,809 $276,242,456 $250,070,650 $895,001,915

17


The following table presents the investments carried at fair value as of August 31, 2011, by caption,

including the current portion of the self-insurance trust of $12,600,000, by the valuation hierarchydefined above

Level 1

Assets

Investments






U S Government guaranteed fixed income


sold (purchased)

Accrued interest

Total assets at fair value

$ 200, 229, 326

218,424,219

6,663,504

3,411,785

Level2 Level3

$ - $

91,008,059

57,352,124 232,838,893

69, 745, 903 -

114,700,766 -

2,034,062 -

Total

$200,229,326

309,432,278

290,191,017

76,409,407

118,112, 551

2,034,062

(352,286) - - (352,286)

1,046,005 - 1,046,005

$428,376,548 $335,886,919 $232,838,893 $997,102,360

The following is a description of the Medical Center' s valuation methodologies for assets andliabilities measured at fair value

Fair value for cash equivalents, corporate stocks, international stocks, U S Government bonds,corporate bonds, municipal bonds and mortgage and asset backed securities are measured usingquoted market prices at the reporting date multiplied by the quantity held

Interests in trustee-held funds are valued at the fair value of the Hospital's interests at year-endbased upon current market value of the underlying securities

The Medical Center has certain investments, principally limited liability corporations, partnerships,and absolute return strategy funds for which a portion of quoted market prices are not availableThese investments are considered alternative investments Because of the inherent uncertainty ofvaluations, values may differ from the values that would have been used had a ready marketexisted The value of these alternative investments represents the ownership interest in the netasset value (NAV) of the respective partnership The fair values (NAV) of the securities held bylimited partnerships that do not have readily determinable fair values are determined by the generalpartner and are based on appraisals, or other estimates that require varying degrees of judgmentInvestments Included in Level 3 consist of the Medical Center's ownership in alternative

investments

During 2012 and 2011, there were no transfers between investment Levels 1 and 2 which areconsidered material to the financial statements

18


The following table is a rollforward of the 2012 balance sheet amounts for financial instrumentsclassified by the Medical Center within Level 3 of the fair value hierarchy defined above

Assets

Beginning balance September 1, 2011

Level 3 Assets

Alternative

Investments

$ 232, 838, 893

Total net unrealized gains 20,809,493

Purchases 16,838,144

Sales (20,415, 880)

Ending balance August 31, 2012 $ 250,070,650

Of the total net unrealized gains related to alternative investments reflected above, $15,291,000represents the unrestricted portion This is reflected in the accompanying statements of operationsand changes in net assets

The following table is a rollforward of the 2011 balance sheet amounts for financial instrumentsclassified by the Medical Center within Level 3 of the fair value hierarchy defined above

Level 3 Assets

Alternative

Investments

Assets

Beginning balance September 1, 2010 $ 219,019,557

Total net unrealized gains 21,807,842

Net purchases, sales, issuances and settlements (7,988,506)

Ending balance August 31, 2011 $ 232,838,893

Of the total net unrealized gains related to alternative investments reflected above , $16,798,000represents the unrestricted portion This is reflected in the accompanying statements of operationsand changes in net assets

The methods described above may produce a fair value calculation that may not be indicative ofnet realizable value or reflective of future fair values Furthermore, while the Medical Centerbelieves its valuation methods are appropriate and consistent with other market participants, theuse of different methodologies or assumptions to determine the fair value of certain financialinstruments could result in a different estimate of fair value at the reporting date

The significant unobservable inputs used in the fair value measurement of the Medical Center'spartnership investments include a combination of cost, discounted cash flow analysis, industrycomparables and outside appraisals Significant increases (decreases) in any inputs used byinvestment managers in determining net asset values in isolation would result in a significantlylower (higher) fair value measurement

19


6. Endowments

The Medical Center's endowment fund consists of individual donor-restricted endowment fundsand funds designated by its Board to function as endowments The net assets associated withendowment funds, including those funds designated by the Board to function as endowments, areclassified and reported based on the existence or absence of donor-imposed restrictions

Illinois passed `Uniform Prudent Management of Institutional Funds Act' ('UPMIFA') The MedicalCenter has interpreted UPMIFA as sustaining the preservation of the original gift as of the gift dateof the donor-restricted endowment funds absent explicit donor stipulations to the contrary As aresult of this interpretation, the Medical Center classifies as permanently restricted net assets, (a)the original value of gifts donated to the permanent endowment, (b) the original value ofsubsequent gifts to the permanent endowment, and (c) accumulations to the permanentendowment made in accordance with the direction of the applicable donor gift instrument at thetime the accumulation is added to the fund The remaining portion of the donor-restrictedendowment fund that is not classified in permanently restricted net assets is classified astemporarily restricted net assets until those amounts are appropriated for expenditure by theMedical Center in a manner consistent with the donor intent and standard of prudence prescribedby UPMIFA Where the Board designates unrestricted funds to function as endowments they areclassified as unrestricted net assets

The Medical Center had the following board -designated and donor-restricted endowment balancesduring the year ended August 31, 2012 delineated by net asset class

Board

Designated Temporarily Permanently

Unrestricted Restricted Restricted Total

Endowment net assets at

beginning of year

Investment return

Investment income

Realized and unrealized gains


Contributions

Spend rate allocation

Appropriation of endowment

assets for expenditure

Other


end of year

$175,471,242 $ 57,837,843 $140,625,427 $373,934,512

1,413,768

7,468, 779

8.882.547

150

5,287,776

(2,926,230) (5,075,554)

(2,113,428) (132,083)

- 1,413,768

860,224 8,329,003

860,224 9,742,771

1,353,886 1,354,036

- 5,287,776

- (8,001,784)

108,230 (2,137,281)

$ 175,719,510 $ 61,512,753 $142,947,767 $380,180,030

20

Children 's Hospital of Chicago Medical Center and AffiliatedCorporationsNotes to Consolidated Financial StatementsAugust 31, 2012 and 2011

Description of Amounts Classified as Permanently Restricted Net Assets and TemporarilyRestricted Net Assets (Endowments Only)

Temporarily Permanently

Restricted Restricted Total

Restricted for Research $ 16,431,555 $ 13,658,383 $ 30,089,938

Restricted for Pediatric Programs 45,081,198 129,289,384 174,370,582--- --- --- ---- --- --- --- --- ---

The Medical Center had the following board-designated and donor-restricted endowment balancesduring the year ended August 31, 2011 delineated by net asset class

Board

Designated Temporarily Permanently

Unrestricted Restricted Restricted Total


beginning of year

Investment return

Investment income

Realized and unrealized gains


Contributions

Spend rate allocation

Appropriation of endowment

assets for expenditure

Redesignation by donor from

temporarily and permanently

restricted to unrestricted

net assets

Other


end of year

$137,856,982 $ 56,258,485 $160,960,187 $ 355,075,654

- 1,594,282 - 1,594,282

- 14,459,625 2,423,336 16,882,961

- 16,053,907 2,423,336 18,477,243

255,134 - 3,114,183 3,369,317

2,855,158 - - 2,855,158

(2,495,025) (4,571,260) - (7,066,285)

36,951,609 (9,780,855) (27,170,754) -

47,384 (122,434) 1,298,475 1,223,425

Description of Amounts Classified as Permanently Restricted Net Assets and TemporarilyRestricted Net Assets (Endowments Only)

Temporarily Permanently

Restricted Restricted Total

Restricted for Research $ 15,490,277 $ 13,658,383 $ 29,148,660

Restricted for Pediatric Programs 42,347,566 126,967,044 169,314,610

$ 57,837,843 $ 140,625,427 $ 198,463,270

21


Investment and Spending Policies

The Medical Center has adopted endowment investment and spending policies that attempt toprovide a predictable stream of funding to programs while seeking to maintain the purchasingpower of endowment assets To achieve its long-term rate of return objectives, the Medical Centerrelies on a total return strategy in which investment returns are achieved through both capitalappreciation (realized and unrealized gains) and current yield (interest and dividends) Anendowment spending rate is established annually by the Investment Committee of the Board,which considers the following

• Portfolio investment returns

• Program needs

• General economic conditions

• Trends in general and medical inflation

• Expected future developments

• Endowment growth needs

The spending rate for endowment funds in fiscal 2012 and 2011 was 4% and 3%, respectivelyManagement and the Board have determined that excess investment return may be spent,consistent with the donor's intention, to support hospital and faculty practice plan growth andoperations Any spending of the excess reserve outside the normal annual spend rate must beapproved by the Executive Committee of the Medical Center

Substantially all temporarily and permanently restricted net assets are restricted for capital,research and programs Substantially all net assets released from restrictions in fiscal 2012 and2011 are related to expenses incurred for capital, research and programs

Concentration of Credit Risk

The Medical Center grants credit without collateral to its patients, most of whom are local residentsand are insured under third-party payor agreements The mix of receivables from patients andthird-party payors at August 31, 2012 and 2011, was as follows

2012 2011

Managed care 37 % 50 %

Illinois Medicaid 57 43

Other (Medicare, Tn-Care, out-of-state Medicaid) 2 1

Patient self-pay 3 5

Commercial insurance 1 1

100% 100%

In fiscal 2012, as a result of the State of Illinois' financial condition, the State slowed Medicaidpayments to healthcare providers, which shifted the mix of accounts receivable balances fromManaged Care to Medicaid when compared to the prior year

22


Retirement Plans

The Medical Center has retirement plans covering substantially all full-time employees, includingemployees of affiliated corporations

The Medical Center has two defined contribution plans available to eligible employees, a 403(b)defined contribution plan available only to eligible pediatric faculty within PFF and a plan availableto all other eligible employees of the Medical Center All non PFF employees are consideredparticipants of the Hospital plan

Participants of the PFF plan are required to make mandatory contributions of 5 percent ofcompensation Each year that a mandatory contribution is made by a participant, PFF will make amatching contribution equal to 10 percent of compensation

Participants of the Hospital plan may participate in a 403(b) deferred contribution plan by enteringinto a salary reduction agreement to contribute a percent of their compensation to the plan TheHospital contributes 100 percent of the first 1 percent of compensation and 25 percent up to thenext 4 percent of compensation that a participant contributes to the plan, resulting in a maximummatch of 2 percent

The Medical Center offered terminated vested participants of its Value Growth Plan (VGP) theoption to receive their pension benefit as a one-time distribution in fiscal year 2013 This is offeredregardless of their age and can be taken as cash or rolled over into another retirement program

The Medical Center's matching expense under both defined contribution plans totaled $9,710,000and $7,969,000 in fiscal 2012 and 2011, respectively

All employees, other than the pediatric faculty of PFF, who have met the vesting requirements, arecovered by a noncontributory, defined benefit cash balance plan (VGP) The benefits paid by thisplan are based on years of service and the employee's age and compensation during those yearsof service The plan generally calls for contribution credits of 4 5% of compensation each year

The Medical Center also sponsors a nonqualified supplemental defined benefit retirement plan(SERP) for certain key executives The plan is not funded and, therefore, has no plan assetsBenefits under the SERP are paid when incurred from the Medical Center's unrestricted net assets

Pension expense for the VGP and SERP plans, as determined by an independent actuary,includes the following components

SERP VGP

2012 2011 2012 2011

Serwce cost, benefits earned during the year $ 282,968 $ 258,473 $ 8,125,013 $ 8,393,747

Interest on projected benefit obligation 587,466 558,520 7,474,679 6,765,437

Expected return on assets - - (10,806,754) (8,103,341)

Amortization of actuarial loss 121,767 26,494 2,697,212 4,264,694

Amortization of pnor service cost 177,565 177,565 76,888 76,888

Net pension expense (included in salaries,

wages, and employee benefits) $ 1,169,766 $ 1,021,052 $ 7,567,038 $ 11,397,425

23


The funded status of the VGP and SERP plans at the end of the year was as follows

Funded status at end of year

Projected benefit obligation

Plan assets at fair market value

Deficiency of plan assets

over projected benefit obligation

Amounts recognized in the consolidated

balance sheet consist of

Current liability

Noncurrent liability

SERP VGP

2012 2011 2012 2011

$ 12,074,377 $ 11,966,170 $184,510,247 $135,314,665

- - 138,535,147 129,528,030

$ (12,074,377) $ (11,966,170) $ (45,975,100) $ (5,786,635)

$ (756,872) $ (2,360,208) $ - $ -

(11,317,505) (9,605,962) (45,975,100) (5,786,635)

$ (12,074,377) $ (11,966,170) $ (45,975,100) $ (5,786,635)

All previously unrecognized actuarial gains and losses and prior service costs are reflected in theconsolidated balance sheet An estimate of $3,113,000 of this amount will be included as acomponent of pension expense in fiscal 2013

The change in the projected benefit obligation during fiscal 2012 and 2011 is summarized asfollows

SERP VGP

2012 2011 2012 2011

Projected benefit obligation at

beginning of measurement year $ 11,966,170 $ 11,580,541 $135,314,665 $129,136,202

Service cost 282,968 258 ,473 8 ,125,013 8 ,393,747

Interest cost 587 , 466 558 ,520 7,474,679 6,765,437

Actuarial loss (gain) 1,608 ,759 716,485 37,221,146 (5,308,423)

Benefits paid (2 , 370,986 ) (1,147,849 ) (3,625 , 256) (3,672,298)

Projected benefit obligation at

end of measurement year $ 12,074,377 $ 11,966,170 $184,510,247 $135, 314,665

The accumulated benefit obligation for the VGP was approximately $181,469,000 and$133,263,000 at August 31, 2012 and 2011, respectively The accumulated benefit obligation forthe SERP plan was approximately $8,743,000 and $10,627,000 at August 31, 2012 and 2011,respectively

24


The change in plan assets during fiscal 2012 and 2011 is summarized as follows

VGP

2012 2011

Plan assets , at fair value at beginning of measurement year $ 129,528,030 $ 97,536,202

Actual return on plan assets 11,032,373 12,664,126

Employer contributions 1,600,000 23,000,000

Benefits paid (3,625,256) (3,672,298)

Plan assets , at fair value at end of measurement year $ 138,535,147 $129,528,030

The following table presents the plan investments carried at fair value as of August 31, 2012, bycaption, by the valuation hierarchy defined in Note 5

Level 1

Assets

Investments

Short-term investments $ 381,529

Common and preferred stock 71,024,058

Alternative investments -

Corporate and municipal bonds 48,291,961

Accrued interest -

Total assets at fair value $ 119,697,548

Level 2 Level 3 Total

$ - $ - $ 381,529

12,761,981 - 83,786,039

- 5,923,697 5,923,697

- - 48,291,961

151,921 - 151,921

4n n40 nnn C nno cn7 0400 COC 4A7

Plan assets included in Level 3 consist of alternative investments The following table is arollforward of the pension assets classified by the Medical Center within Level 3 of the fair valuehierarchy

Level 3 Assets

Alternative

Investments

Assets


Total net unrealized gains

Ending balance August 31, 2012

$ 5,097,561

826,136

$ 5,923,697

25


The following table presents the plan investments carried at fair value as of August 31, 2011, bycaption, by the valuation hierarchy defined in Note 5

Level1 Level 2 Level 3 Total

Assets

Investments



Altemative investments


Accrued interest

Total assets at fair valu

$ 10,360,484 $ - $ - $ 10,360,484

57,990,104 14,322,547 - 72,312,651

- 8,415,886 5,097,561 13,513,447

33,251,991 - - 33,251,991

- 89,457 - 89,457

e $101,602,579 $ 22,827,890 $ 5,097,561 $ 129,528,030

Plan assets included in Level 3 consist of alternative investments The following table is arollforward of the pension assets classified by the Medical Center within Level 3 of the fair valuehierarchy

Level 3 Assets

Alternative

Investments

Assets


Total net unrealized gains

Ending balance August 31, 2011

$ 4,252,820

844,741

$ 5,097,561

The Medical Center's pension plan weighted-average asset allocations at August 31, 2012 and2011, by asset category are as follows

2012 2011

Asset category

Equity securities 60 % 54 %

Fixed-income securities and cash 40 46

inn o/ Inn o/

The underlying investment strategy for the pension investment pool is to maintain a target balanceof 60% equity securities and 40% fixed-income securities designed to achieve the targetinvestment return of the consumer price index plus 5% The minimum and maximum allocationsare reflected below

Equity securities

Fixed-income securities and cash

Target Minimum

60% 45%

40 33

26

Maximum

75%

48


The Medical Center investments are invested with external managers according to an assetallocation that relies on a total return strategy in which investment returns are achieved throughboth capital appreciation (realized and unrealized) and current yield (interest and dividends) over along-term time horizon

Equity securities include public equities traded in both domestic and international markets Thepurpose of equities is to provide access to liquid markets and serves as a long-term hedge againstinflation

Fixed-income securities and cash includes cash and cash equivalents, fixed income securitiesissued by both domestic and international issuers, and investment in a global fixed incomearbitrage strategy that seeks to earn a return over Treasury Inflation Protected Securities Thepurpose of fixed-income securities is to provide a stable income stream and greater certainty ofnominal cash flow relative to equities Given the low correlation to other asset classes, fixedincome assets also enhance diversification

The estimated contribution to the pension plan in fiscal year 2013 is approximately $8,000,000

Estimated future pension benefit payments for the next 10 years are as follows

SERP VGP Total

Years Ending August 31,

2013 $ 756,872 $ 5,622,190 $ 6,379,0622014 1,464,409 5,530,413 6,994,822

2015 4,625,807 5,601,202 10,227,009

2016 2,906,618 5,774,810 8,681,428

2017 1,234,051 6,152, 514 7,386,5652018-2022 7,106, 826 39, 399, 593 46, 506, 419

$ 18, 094, 583 $ 68, 080, 722 $ 86,175, 305

Weighted-average assumptions used to determine benefit obligations at August 31, 2012 and 2011are as follows

SERP VGP

2012 2011 2012 2011

Discount rate 3 90 % 530% 390% 530%

Rate of compensation increase 4 00 4 00 4 00 4 00

27


Weighted-average assumptions used to determine net periodic pension benefit cost in fiscal 2012and 2011 are as follows

SERP VGP

2012 2011 2012 2011

Discount rate 530% 500% 530% 500%

Expected return on plan assets n/a n/a 8 50 8 50

Rate of compensation increase 4 00 4 00 4 00 4 00

The discount rate was determined by constructing hypothetical yield curves based on yields ofcorporate bonds rated AA quality The expected rate of return on plan assets was determined byusing the historical return on the various asset classes in which the plan invests

Long-Term Debt

In May 2008, the Illinois Finance Authority issued $553,490,000 of Series 2008 Bonds on behalf ofthe Hospital The issue included $212,000,000 of Insured Revenue Bonds Series 2008A ('Series2008A'), $168,000,000 of Revenue Bonds Series 2008B ('Series 2008B'), $86,745,000 of VariableRate Demand Revenue Bonds Series 2008C ('Series 2008C'), and $86,745,000 of Variable RateDemand Revenue Bonds Series 2008D ('Series 2008D'), (collectively, the `Series 2008 Bonds')The proceeds of the Series 2008A and Series 2008B bonds are to be used primarily to providesupport for the construction of the Ann & Robert H Lurie Children's Hospital of Chicago (Note 1)

The proceeds of the Series 2008C and 2008D bonds were used to (a) refund the $62,050,000outstanding principal amount of IHFA Variable Rate Demand Revenue Bonds, Series 1999BPeriodic Auction Reset Securities (PARS), (b) refund the $30,750,000 outstanding principal amountof IHFA Variable Rated Demand Revenue Bonds, Series 2003A Periodic Auction Reset Securities

and the $24,975,000 outstanding principal amount of IHFA Variable Rate Demand RevenueBonds, Series 2003B Periodic Auction Reset Securities (PARS), (c) refund the $54,725,000outstanding principal amount of the Authority's Variable Rate Demand Revenue Bonds, Series2004 Periodic Auction Reset Securities (PARS), and (d) pay certain expenses in connection withthe issuance of the Series 2008C/D Bonds

In connection with the Series 2008C and 2008D bonds, the Hospital has two liquidity/letter of creditagreements with JP Morgan Chase Bank which expire in December 2014 Under the terms ofthese agreements, the bank will make liquidity advances under letters of credit to the Bond Trusteein the amount necessary to purchase the Series 2008C and 2008D bonds if not remarketed Ifthese agreements are not renewed or replaced prior to expiration, the applicable Bond Indenturerequires the Bond Trustee to purchase the related Variable Rate Demand Revenue Bonds with theproceeds from such liquidity/letter of credit agreements Liquidity advances would be payable, withinterest, in twelve equal quarterly installments of principal with the initial installment of principalpayable on the date which is 367 days after the liquidity advance is made

Simultaneously with the issuance of the Series 2008 Bonds, the Hospital utilized the proceeds of aborrowing under a taxable line of credit from JPMorgan Chase Bank to refinance (a) the$11,685,000 outstanding principal amount of IHFA Revenue Bonds, Series 1993 and (b) the$3,415,000 outstanding principal amount of IHFA Revenue Bonds, Series 1999A The rate on theborrowing is the Libor rate plus 1%, which equaled 1 23% as of August 31, 2012

28


The Medical Center's long-term debt is issued under a Master Trust Indenture ('Indenture') datedMay 1, 2008, as amended and restated Obligations under the Indenture are collateralized by apledge of the unrestricted receivables of the obligated group, which consists of the Hospital and theFoundation (the `Obligated Group')

In connection with the sale of existing bond financed property and completion of the new hospitalproject, the Medical Center exercised options to call portions of its Series 2008C and Series Dbonds for redemption and payment prior to maturity Operating cash and the taxable line of creditof JP Morgan Chase were used as sources for the redemption The related amounts in the JPMorgan Chase Bank letter of credit agreements described above were reduced accordingly Theredemptions occurred as follows

Date Series Principal Redeemed Source

December 7, 2011 2008C $ 1,050 ,000 Operating cash

January 17, 2012 2008C 30,000 ,000 Operating cash

May 1 , 2012 2008C 26,000,000 Taxable line of credit

Total 2008C Series Redeemed $ 57,050,000

December 7, 2011 2008D $ 1,050, 000 Operating cash

January 17, 2012 2008D 30,000, 000 Operating cash

May 1 , 2012 2008D 26,000,000 Taxable line of credit

Total 2008D Series Redeemed $ 57,050,000

In February 2012, the Illinois Finance Authority issued $60,000,000 of Series 2012 Bonds directlyplaced with JPMorgan Chase Bank, NA on behalf of the Hospital The issue included $30,000,000variable rate Demand Revenue Bonds Series 2012A ('Series 2012A') and $30,000,000 of fixed rateRevenue Bonds Series 2012B ('Series 2012B') The proceeds of the Series 2012A and Series2012B bonds were used primarily to provide support for the construction of theAnn & Robert H Lurie Children's Hospital of Chicago (Note 1)

29


Long-term debt at August 31, 2012 and 2011 consisted of the following

2012 2011

Illinois Finance Authority insured re\,enue bonds, Series 2008A,

fixed interest rate ranging from 5 00% to 5 25%, maturing

annually in principal amounts ranging from $3,235,000 in

August 2028 to $23,340,000 in August 2047 $212,000,000 $212,000,000

Illinois Finance Authority revenue bonds, Series 2008B,

fixed interest rate ranging from 5 25% to 5 50%, maturing

annually in principal amounts ranging from $4,415,000 in

August 2015 to $15,555,000 in August 2039 168,000,000 168,000,000

Illinois Finance Authority Variable Rate Demand Re\,enue

Bonds, Series 2008C, vanable interest, ranging from 0 15%

to 0 19% in fiscal year 2012 maturing in principal amounts

ranging from $5,945,000 in August 2014 to $8,670,000in August 2025 29,695,000 86,745,000

Illinois Finance Authority Variable Rate Demand Re\,enue

Bonds, Series 2008D, vanable interest, ranging from 0 13%

to 0 17% in fiscal year 2012 maturing in principal amountsranging from $5,945,000 in August 2014 to $8,670,000

in August 2025 29,695,000 86,745,000

Illinois Finance Authority revenue bonds, Series 2012A

variable interest, ranging from 0 93% to 0 96% in fiscalyear 2012, maturing in principal amounts ranging from

$745,000 in March 2015 to $1,475,000 in March 2042 30,000,000

Illinois Finance Authority revenue bonds, Series 2012B,

fixed interest rate of 2 44%, maturing annually inprincipal amounts ranging from $935,000 in March 2015 to

$1,220,000 in March 2042

JPMorgan Chase Bank, NA Rewlving Credit Agreement,

variable interest ranging from 1 23% to 1 25% in fiscalyear 2012, maturing in December 2014 with a balloon

payment equal to balance

Total debt outstanding

Less Unamortized discount

Long-term debt

30, 000, 000

67.098.596

566, 488, 596

(2.500.845 )

15, 079, 468

568, 569, 468

(2.607.285)

$ 563.987.751 $ 565.962.183

The estimated fair value of the Medical Center' s total debt outstanding was approximately$591,926,000 as of August 31, 2012 This estimate is based on market interest rates and otherrelevant information as determined by management and input from financial advisors

30


Future maturities of total outstanding debt at August 31, 2012, are as follows


2013 $ -

2014 11, 890, 000

2015 85, 513, 596

2016 19, 090, 000

2017 19, 825, 000

Thereafter 430,170, 000

$ 566.488.596

The Obligated Group is subject to various nonfinancial and financial covenants Managementbelieves that the Obligated Group was in compliance with its debt covenants as of August 31, 2012and 2011

As of August 31, 2012, the Medical Center had line of credit agreements with three commercialbanks for $45,000,000, $30,000, 000 and $25,000,000 One outstanding letter of credit supportingnew hospital requirements totaling $3,835,000 reduces this available balance There were noamounts outstanding or borrowings made under the lines of credit during 2012 or 2011

10. Operating Leases

The Medical Center leases certain buildings, office space, and equipment under noncancelableoperating leases Payments associated with these leases were approximately $3,800,000 and$2,700,000 in 2012 and 2011, respectively, including minimum monthly payments and additionalusage charges under equipment leases During fiscal 2012, the Hospital entered into anassignment of lease with Playboy Enterprises, Inc by which Playboy Enterprises, Inc assigned tothe Hospital its operating lease with Golub LSP Investors, LP, as landlord, for space located in the

building at 680 N Lake Shore Drive At the time of the assignment, the lease had a remaining termof 10 years and 2 months, but as a condition to its consent to the assignment, Golub LSPInvestors, LP required the Hospital to agree to a 5 year, 4 month extension of the lease term,resulting in a total lease term for the Hospital of 15 years, 6 months There are monthly leasepayments that began in July 2012 to be made over the life of the lease

Approximate minimum future payments under noncancelable lease obligations at August 31, 2012,are as follows


2013 $ 5,178, 000

2014 5,800,000

2015 5,941,000

2016 5,421,0002017 5,252,000

Thereafter 61,182,000

$ 88.774.000

31


11. Professional and General Liability Insurance

The Medical Center maintains a program of self-insurance for professional liability and generalliability risks This program is maintained on behalf of all Medical Center affiliates and employees,including the employed physicians of PFF and LCMG, and the nonemployed affiliated physicians inthe Children's Hospital of Chicago Faculty Practice Plan who are members of Children's SurgicalFoundation and Pediatric Anesthesia Associates More than 400 hospital-based physicians arecovered by this program

The Medical Center self-insures the first losses for both professional liability and general liabilityclaims The estimated liability for self-insured claims and the required funding for the trust aredetermined annually by an independent actuary and are based upon case reserves and actuarialestimates for claims that have been incurred but not yet reported The self-insured portion of theprogram is administered by an independent trustee

The Medical Center incurred approximately $14,218,000 and $6,100,000 in expense for fiscal 2012and 2011, respectively, for self-insured professional and general liability risks The MedicalCenter's self-insurance liability has been discounted at 6% in fiscal 2012 and 2011 The effect ofdiscounting the value of estimated liabilities was approximately $24,163,000 and $25,598,000 atAugust 31, 2012 and 2011, respectively In management's opinion, adequate provision has beenmade for the estimated self-insurance liability

In addition to the self-insured portion, the Medical Center purchases commercial insurance forclaims in excess of the self-insurance limits These excess insurance policies, which are claims-made, are purchased through CMMC Insurance

CMMC Insurance writes the professional and general liability insurance for the Hospital and itsaffiliates CMMC Insurance, in turn, purchases reinsurance equal to 100% of its exposure and,therefore, holds no risk on its own books For the years ended August 31, 2012 and 2011,premiums ceded to reinsurers were $2,002,000 and $2,900,000, respectively, and reinsurancerecoveries on unpaid losses on an undiscounted basis, were $14,500,000 and $10,600,000,respectively CMMC Insurance is operated to break even after all expenses

12. Transactions With Related Parties

Certain of the Hospital's affiliated physicians participate in independent physician faculty practiceplan corporations At August 31, 2012 and 2011, amounts due from the physician practice groupstotaled approximately $2,018,000 and $1,321,000, respectively, a portion of which is included inother current assets and other assets

The Hospital paid approximately $4,915,000 and $4,938,000 in fiscal 2012 and 2011, respectively,for administration, supervision, teaching, and patient care services provided by these independentphysicians, which is included in supplies and services expense

The Hospital billed such independent physician group practice corporations $6,723,000 and$4,689,053 in fiscal 2012 and 2011, respectively, for certain expenses, such as personnelexpenses, supplies and services, and professional liability insurance, incurred on their behalf,which is included in other operating revenue

32


13. Functional Expenses

The Medical Center provides health care services to children and conducts research and programswithin its geographic region Expenses related to providing these services and research andprograms were as follows

2012 2011

Patient care services

General and administrative

Research and programs

Fund-raising

Illinois Hospital Assessment Program

$ 524,935,824 $479,810,211

92,260,034 81,573,706

56, 556, 876 55,120, 269

19, 517,468 14, 758, 078

13, 729,114 13, 729,114

$ 706, 999, 316 $ 644, 991, 378

14. Commitments and Contingencies

Health Care Regulation

The health care industry is subject to numerous laws and regulations of federal, state, and local

governments Recently, government activity has increased with respect to investigations andallegations concerning possible violations of fraud and abuse statutes and regulations by healthcare providers Violations of these laws and regulations create a possibility of significantrepayments for patient services previously billed Compliance with such laws and regulations canbe subject to future government review and interpretation, as well as regulatory actions unknown orunasserted at this time

Management believes that the Medical Center is in compliance, in all material respects, with fraudand abuse statutes, as well as with other applicable government laws and regulations While noregulatory inquiries have been made, that are expected to have a material effect on theconsolidated financial statements, compliance with such laws and regulations can be subject tofuture government review and interpretation, as well as regulatory actions unknown or unassertedat this time

Litigation

There are several lawsuits, pending claims, and incidents that occurred in the past whereby claimshave been made and may be asserted against the Medical Center for which the ultimate liability, ifany, cannot be reasonably estimated Management believes that the ultimate settlement of theseclaims will not have a material adverse effect upon the Medical Center's consolidated financialposition or results of operations

Investments

The Medical Center has contractual commitments totaling $15,000,000 with its private equityinvestment funds As of August 31, 2012, the Medical Center' s remaining capital commitments are$7,350,000 Future capital calls are expected to occur over the next several years and will beinitiated by the general partner of the investment as investments are made by the funds

33


Asset Retirement Obligation

An asset retirement obligation represents a legal obligation associated with the retirement of atangible long-lived asset that is incurred upon the acquisition, construction, development, or normaloperation of that long-lived asset The asset retirement obligations are accreted to their presentvalue at the end of each reporting period The associated estimated asset retirement costs arecapitalized as part of the carrying amount of the long-lived asset and depreciated over its usefulI ife

The Medical Center has evaluated its leased and owned properties for potential asset retirementobligations Based on this review, the Medical Center identified obligations primarily related to theremoval of certain materials previously utilized in the construction process The total retirementobligation recognized as of August 31, 2012 and 2011, was $3,504,000 and $3,429,000,respectively, which is recorded as other long-term liabilities in the consolidated balance sheets

15. Subsequent Event

The 759 W Belden Property was sold to DePaul University on October 9, 2012 for a sales price of$10,715,000

Management has evaluated subsequent events through December 5, 2012

34

Children's Hospital of Chicago Medical Center and Affiliated CorporationsConsolidating Balance SheetAugust 31, 2012

Eliminating Entries Obligated Eliminating Entries

Debit Credit Group Debit Credit Total

Assets

Cur enl assets

Cash and cash equivalents $ 14 256 127 $ $ $ $ 14 256 127 $ $ 325 262 $ 5 617 337 $ $ 203 565 $ $ $ 20 602 291

Current ponlon of self insurance Irusl 26 500 000 26 500 000 26 500 000

A ccounls receivable net of allowance

far uncollecllble accounts of $11 155 000 101 660 116 101 660 116 6 653 507 2 169 639 112 723 462

Other current assets 31 346 330 621 646 31 969 976 216 535 4 110 694 266 631 76 025 16 466 272 53 132 133

Total current assels 1 75 964 573 621 646 1 76 606 219 216 535 13 069 463 6 295 607 76 025 16 671 637 214 957 666

lnvesImenIs 666 501 915 666 501 915 120 000 120 000 666 501 915

Properly and equipment al cosl 1 373 667 226 2 372 646 1 376 239 672 43 054 062 1 419 293 954

Less Accumulated depreclallon 330 406 674 2 333 719 332 740 593 24 611 167 357 351 760

Tolal properly and equipment net 1 043 460 352 36 927 1 043 499 279 16 442 695 1 061 942 1 74

Other assels 120 175 754 120 175 754 120 175 754

Tolal assels $ 2 206 122 594 $ 660 573 $ $ $ 2 206 763 167 $ 16 661 430 $ 13 069 463 $ 6 295 607 $ 196 025 $ 16 671 637 $ $ 120 000 $ 2 263 577 729

35

Children's Hospital of Chicago Medical Center and Affiliated CorporationsConsolidating Balance SheetAugust 31, 2012

Eliminating Entries Obligated Eliminating Entries

Debit Credit Group I Debit Credit Total

Liabilities and Net Assets

Curren I Iiabtl l,es

Accounts payable and accrued expenses $ 132 979 531 $ 3439 067 $ $ $ 136418 598 $ 1 021 952 $ 7960399 $ 4210132 $ (1) $ 16523250 $ $ $ 166 1 2 330

Current portion of self insurance habtlAy 20 500 000 20 500 000 20 500 000

Due to Ihird parly pay ors 11 054 513 11 054 513 661 391 11 715 904

Tolal current Iiabddies 172 534 044 3 439 067 1 75 973 111 1 021 952 0 629 790 4 210 132 (1) 16 523 250 206 358 234

Other habilies 140 512 539 140 512 539 140 512 539

Long term debl 563 987 751 563 987 751 563 987 751

Tolal liabildies 885 034 334 3 439 067 000 473 401 1 021 952 0 629 790 4 210 132 (1) 16 523 250 918 858 524

Stockholders equity

Common slack 120 000 120 000

Additional paid in capital

Retained earnings 20507 20507

Tolal stockholder s equity 140 587 140 507

Nel assets

Unreslricled 982 985432 (2770494) 900206930 17 639478 4459673 4005675 196026 20507 1006616377

Temporanly restricted 195 155 061 195 155 061 195 155 061

Permanent ly reslncled 142 947 767 142 947 767 142 947 767

Tolal net assels 1 321 000 260 (2770494) 1310309766 17 639478 4459673 4005675 196026 20507 1344719205

Tolal liabildies and net assels $ 2 206 122 594 $ 660 573 $ $ $ 2 206 783 167 $ 10 661 430 $ 13 009 463 $ 0 295 007 $ 196 025 $ 16 671 837 $ 140 507 $ 20 507 $ 2 263 577 729

36

Children's Hospital of Chicago Medical Center and Affiliated CorporationsConsolidating Statement of Operations and Changes in Unrestricted Net AssetsYear Ended August 31, 2012

Operating revenue

Nel palienl service revenue

Nel assels released from reslriclions

Conlribulions and philanthropy used

for program purposes

Grants and other restricted income used

for program purposes

Board designaled endow menl income

Other operating revenue

Tolal operating revenue

Operating expenses

Salanes wages and employee benefits

Supplies and services

Deprecialion

Provision for bad debts

Tolal operating expenses

Income from operalions before

inleresl and

amen

i,al

'on

Inleresl and amorlvalion of financing costs

Income from operations

Nonoperaling income (expense) net

Excess (deficiency) of

revenue over expenses

Nel assels released from reslriclions used

for purchase of properly and equipment

Relirenenl plan relaled change other Ihan net

periodic retirement plan expense

Conlribulion

Other

Transfers (lo) from affiliales

c se) inIncrease (de

aunreslncled nelassels

s Eliminating Entries Obligated Eliminating Entries

Debit Credit Group Debit Credit Total

$ 525 751 341 $ $ $ $525 751 341 $ $ 69 654 803 $ 14 193 596 $ $ $ 004 150 $ $608 795 590

22 013 060 22 013 060 6 009 357 6 009 357 22 013 060

38 317 163 38 317 163 5 724 981 5 724 981 38 317 163

4 063 890 4 063 890 4 063 890

31419901 31 419981 11371416 10391757 5300131 73199 18 758408 47 798076

622 365443 622 365443 11371416 99700090 19493727 73199 31296096 721707707

308 316 753 8 733 390 8 733 390 300 316 753 10 121 262 87 575 138 14 654 265 405 294 20 455 337 400 697 375

216 151 529 10 533 327 10 533 327 216 151 529 6 500 590 10 424 626 3 232 300 19 060 73 4 70 11 607 203 232 794 300

42 159 274 250 751 250 751 42 159 274 1 807 810 045 724 44 012 000

5 671 430 5 671 430 3 116 073 309 054 9 177 365

572 290 994 19 517 460 19 517 460 572 290 994 10 509 662 109 116 637 10 275 619 504 362 73 470 045 724 32 142 620 607 401 040

50066449 (19517460) 19517460 50066449 (7130246) (9335739) 1210100 (504362) (271) 32142620 32142620 34 305939

0 541 370 0 541 370 0 541 370

41525071 (19517460) 19517460 41525071 (7130246) (9335739) 1210100 (504362) (271) 32142620 32142620 25764561

45370463 20203359 19517460 46144354 471 62 46144007

06903534 765 891 19517460 19517460 07669425 (7130246) (9335260) 1210100 (504362) (209) 32142620 32142620 71909440

224 937 859 224 937 059 224 937 059

(35 763 062) (35 763 062) (35 763 062)

5426966 (5426966)

295 460 (9) 295 459 10 750 306 209

(21 117 226) 3 344 144 (17 773 002) 5 570 002 11 510 674 179 965 504 361

$ 260603539 $ (1316940) $ 19517460 $ 19517460 $259366599 $ (1557414) $ 2103406 $ 1390073 $ (1) $ (209) $ 32142620 $ 32142620 $261390454

37

Additional Data

Software ID:

Software Version:

EIN: 36-2170833


Form 990, Part VII - Compensation of Officers, Directors,Trustees, Key Employees, HighestCompensated Employees, and Independent Contractors

(A) (B) (C) (D) ( E) (F)Name and Title Average Position (check all Reportable Reportable Estimated

hours that apply) compensation compensation amount of otherper ,D = from the from related compensationweek boo organization (W- organizations from the

E ,77 0 rD 2/1099-MISC) (W- 2/1099- organization and

-n MISC) relatedc °- organizations

5

D 1m 4 q^

4' Q•

JOHN J ALLEN1 0 X 0 0 0

DIRECTOR

JOHN AMBOIAN JR1 0 X 0 0 0

DIRECTOR

SARAH BAINE1 0 X 0 0 0

EX-OFFICIO DIRECTOR

STEPHEN W BAIRD1 0 X 0 0 0

DIRECTOR

PETER B BENSINGER1 0 X 0 0 0

DIRECTOR

ANDREWT BERLIN1 0 X 0 0 0

DIRECTOR

BARBARA L BOWLES1 0 X 0 0 0

DIRECTOR

JILL BRENNAN1 0 X 0 0 0

DIRECTOR

DAVID BUNNING1 0 X 0 0 0

DIRECTOR

GREGORY C CASE1 0 X 0 0 0

DIRECTOR

JOHN A CHALLENGER1 0 X 0 0 0

DIRECTOR

ALAN CHAPMAN1 0 X 0 0 0

DIRECTOR

ROBERT CLARK1 0 X 0 0 0

DIRECTOR

ELEANOR 0 CLARKE1 0 X 0 0 0

DIRECTOR

KEVIN M CONNELLY1 0 X 0 0 0

DIRECTOR

JOHN D COONEY1 0 X 0 0 0

DIRECTOR

JOHN M CROCKERJR1 0 X 0 0 0

VICE-CHAIR & DIRECTOR

LESTER CROWN1 0 X 0 0 0

DIRECTOR

PAULA H CROWN1 0 X 0 0 0

DIRECTOR

LETICIA PERALTA DAVIS1 0 X 0 0 0

DIRECTOR

SUSAN DEPREE1 0 X 0 0 0

DIRECTOR

JAMES DEROSE1 0 X 0 0 0

DIRECTOR

WILLIAM J DEVERS JR1 0 X 0 0 0

DIRECTOR

JOHN DOERGE JR1 0 X 0 0 0

DIRECTOR

JAMES DONALDSON MD40 0 X 0 533,339 218,543

EX-OFFICIO DIRECTOR


(A) (B) (C) (D) (E) (F)Name and Title Average Position ( check all Reportable Reportable Estimated

hours that apply ) compensation compensation amount of otherper ,o = from the from related compensationweek 0 ^] 5 organization ( W- organizations from the

0 V 2/1099-MISC ) (W- 2/1099- organization and

-n MISC) related0-c c

Q'° °- organizations

0- m m

QQ

-D

4' 4• ^4• +a

CHARLES W DOUGLAS1 0 X 0 0 0

DIRECTOR

DENNIS J DRESCHER1 0 X 0 0 0

DIRECTOR

ANA DUTRA1 0 X 0 0 0

DIRECTOR

MICHAEL EVANGELIDES1 0 X 0 0 0

DIRECTOR

TYRONE C FANNER1 0 X 0 0 0

DIRECTOR

LESLIE FALK1 0 X 0 0 0

EX-OFFICIO DIRECTOR

MITCHELL FEIGER1 0 X 0 0 0

DIRECTOR

DIANA S FERGUSON1 0 X 0 0 0

DIRECTOR

MICHAEL W FERRO JR1 0 X 0 0 0

DIRECTOR

DAVID FOX JR1 0 X 0 0 0

DIRECTOR

JOHN S GATES JR1 0 X 0 0 0

DIRECTOR

LAURENCE S GELLER1 0 X 0 0 0

DIRECTOR

BERT A GETZ JR1 0 X 0 0 0

DIRECTOR

JEFFREY GLASSROTH MD1 0 X 0 0 0

EX-OFFICIO DIRECTOR

LAUREN GORTER1 0 X 0 0 0

DIRECTOR

THOMAS P GREEN MD40 0 X 0 686,258 58,102

EX-OFFICIO DIR/PRES&CHAIR PFF

JOSEPH GREGOIRE1 0 X 0 0 0

DIRECTOR

DAVID D GRUMHAUS1 0 X 0 0 0

DIRECTOR

ARLINGTON GUENTHER1 0 X 0 0 0

DIRECTOR

JOSEPH D GUTMAN1 0 X 0 0 0

DIRECTOR

BRUCE R HAGUE1 0 X 0 0 0

DIRECTOR

TODD M HAMILTON1 0 X 0 0 0

DIRECTOR

PAUL F HANZLIK1 0 X 0 0 0

DIRECTOR

BRETT J HART1 0 X 0 0 0

DIRECTOR

DAVID A HELFAND1 0 X 0 0 0

DIRECTOR


(A) (B) (C) (D) (E) (F)Name and Title Average Position (check all Reportable Reportable Estimated

hours that apply) compensation compensation amount of otherper ,o = from the from related compensationweek 0 = Z organization (W- organizations from the

4 2/1099-MISC) (W- 2/1099- organization andT MISC) related

c c(D

+° 00 °- organizations

J- m

iQ' Q

0Vit,

MARY J C HENDRIX PHD40 0 X 0 575,155 87,442

EX-OFF DIR PRS/SI OFF RCH CTR

DANIEL J HENNESSY1 0 X 0 0 0

VICE CHAIR & DIRECTOR

JAMES HICKEY1 0 X 0 0 0

DIRECTOR

GARY E HOLDREN1 0 X 0 0 0

DIRECTOR

MARK HOPPE1 0 X 0 0 0

DIRECTOR

CHARLES H JAMES III1 0 X 0 0 0

DIRECTOR

KIRK B JOHNSON1 0 X 0 0 0

DIRECTOR

W BRUCE JOHNSON1 0 X 0 0 0

DIRECTOR

GEORGE D KENNEDY1 0 X 0 0 0

DIRECTOR

ANTHONY K KESMAN1 0 X 0 0 0

DIRECTOR

RICHARD P KIPHART1 0 X 0 0 0

DIRECTOR

FRED L KREHBIEL1 0 X 0 0 0

DIRECTOR

ADAM M KRIGER1 0 X 0 0 0

DIRECTOR

GERALD R LANZ1 0 X 0 0 0

DIRECTOR

ERIC P LEFKOFSKY1 0 X 0 0 0

DIRECTOR

LYLE LOGAN1 0 X 0 0 0

DIRECTOR

SHELLEY A LONGMUIR1 0 X 0 0 0

DIRECTOR

DANIELTWLUM MD1 0 X 0 0 0

EX-OFFICIO DIRECTOR

PATRICK M MAGOON40 0 X X 1,169,917 0 417,827

EX-OFF DIR/CEO, MED CTR/HOSP

MITCHELL J MANASSA1 0 X 0 0 0

DIRECTOR

JOHN F MANLEY1 0 X 0 0 0


ROXANNE MARTINO1 0 X 0 0 0

DIRECTOR

PETER D MCDONALD1 0 X 0 0 0

DIRECTOR

JACK L MCGINLEY1 0 X 0 0 0

DIRECTOR

ANDREW 3 MCKENNA1 0 X 0 0 0

DIRECTOR


(A) (B) (C) (D) (E) (F)Name and Title Average Position ( check all Reportable Reportable Estimated

hours that apply) compensation compensation amount of otherper ,o = from the from related compensationweek 0 = Z organization (W- organizations from the

4 2/1099-MISC ) (W- 2/1099- organization andT MISC) related

c c(D

+° 00 °- organizations

J- m

iQ' Q

0Vit,

WILLIAM J MCKENNA1 0 X 0 0 0

DIRECTOR

JAMES J MCNULTY1 0 X 0 0 0

DIRECTOR

LOUISE C MILLS1 0 X 0 0 0

DIRECTOR

JOHN C MOORE1 0 X 0 0 0

DIRECTOR

ROBERT S MURLEY1 0 X 0 0 0


ERIC G NEILSON MD1 0 X 0 0 0

DIRECTOR

DAVID NEITHERCUT1 0 X 0 0 0

DIRECTOR

LESLIE NEWMAN1 0 X 0 0 0

DIRECTOR

EDWARD OGATA MD40 0 X X 699,385 0 51,203

EX-OFFICIO DIR/CMO/HOSP

NANCY PACHER1 0 X 0 0 0

DIRECTOR

CHAKA M PATTERSON1 0 X 0 0 0

DIRECTOR

PEER PEDERSEN10 X 0 0 0


DOUGLAS A PERTZ1 0 X 0 0 0

DIRECTOR

LORNA S PFAELZER1 0 X 0 0 0

DIRECTOR

DAVID C PISOR1 0 X 0 0 0

DIRECTOR

ASHISH PRASAD1 0 X 0 0 0

DIRECTOR

SETH PROSTIC1 0 X 0 0 0

DIRECTOR

GERALD D PUTNAM1 0 X 0 0 0

DIRECTOR

MOHAN RAO PHD1 0 X 0 0 0

DIRECTOR

ANDREA REDMOND1 0 X 0 0 0

DIRECTOR

SUSAN REGENSTEIN1 0 X 0 0 0

DIRECTOR

THOMAS R REUSCH1 0 X 0 0 0

DIRECTOR

J CHRISTOPHER REYES 7 0 X 0 0 0MED CNTR/HOSP CHAIR

MARLETA REYNOLDS MD1 0 X 0 0 0

EX-OFFICIO DIRECTOR

PETER C ROBERTS1 0 X 0 0 0

DIRECTOR



hours that apply) compensation compensation amount of otherper ,o = from the from related compensationweek 5 organization organizations from the

D 0 (W- 2/1099- (W- 2/1099- organization

-n MISC) MISC ) and relatedC o '° a ° organizations

2L 5 m

Q -D

4' Qr ^

MANUEL SANCHEZ1 0 X 0 0 0

DIRECTOR

DEBORAH M SAWYER1 0 X 0 0 0

DIRECTOR

H WILLIAM SCHNAPER MD40 0 X 0 293,633 51,915

EX OFFICIO DIRECTOR/PFF MD

CHRISTOPHER SEGAL1 0 X 0 0 0

DIRECTOR

DERRY WEYERHAEUSER1 0 X 0 0 0

DIRECTOR

STEPHEN A SMITH1 0 X 0 0 0

DIRECTOR

THOMAS S SOULELES1 0 X 0 0 0

DIRECTOR

STEPHEN T STEERS1 0 X 0 0 0

DIRECTOR

DIANE SWONK1 0 X 0 0 0

DIRECTOR

EDWARD S TRAISMAN MD1 0 X 0 0 0

EX-OFFICIO DIRECTOR

MONSIGNOR KENNETH VELD1 0 X 0 0 0

DIRECTOR

MATTHEW WALSH1 0 X 0 0 0

DIRECTOR

EDWARD J WEHMER1 0 X 0 0 0

DIRECTOR

BRIAN E WILLIAMS1 0 X 0 0 0

DIRECTOR

LINDA S WOLF1 0 X 0 0 0

DIRECTOR

JAMES WOOTEN JR1 0 X 0 0 0

DIRECTOR

MS JIA ZHAO1 0 X 0 0 0

DIRECTOR

SUSAN H GORDON40 0 X 317,844 0 93,046

CHIEF COMMUNIC & EXT AFFRS

MONICA HEENAN40 0 X 336,575 0 82,760

CHIEF AMBUL SRV/MED MGMT

BRUCE KOMISKE40 0 X 493,413 0 27,712

CHIEF NEW HOSP DESIGN/CONST

STANLEY B KROK40 0 X 371,506 0 261,385

CHIEF INFORMATION OFFICER

MAUREEN T MAHONEY40 0 X 271,620 0 98,831

CHIEF EXCELLENCE OFFICER

MAUREEN MURPHY40 0 X 388,187 0 114,041

CHIEF MARKETING/ MNGD CARE OFF

PAULA M NOBLE40 0 X 543,142 0 229,178

CFO/TREAS/MED CTR &AFFLTS

ROBERT J POWELL40 0 X 482,582 0 110,550

CHIEF HR OFFICER



hours that apply) compensation compensation amount of otherper ,o = from the from related compensationweek 0 ^] 5 organization (W- organizations from the

0 V 2/1099-MISC ) (W- 2/1099- organization and

-n MISC) relatedc o '° °- organizations

0- m m

Qif.

4• +a

MICHELLE M STEPHENSON40 0 X 407,859 0 148,299

CHIEF NURSE EXECUTIVE

DONNA S WETZLER40 0 X 408,331 0 381,116

GEN CNSL&CORP SEC/MED CTR&AFF

SHERWOOD D ZELLERMAYER40 0 X 273,361 0 33,856

CHIEF PUBLC AFFAIRS COMMUNCTNS

THOMAS J SULLIVAN40 0 X 569,323 0 84,231

PRESIDENT FNDTN

RON H BLAUSTEIN40 0 X 253,957 0 38,423

ASSOC CHIEF FINANCIAL OFFICER

NANCY M BORDERS40 0 X 266,509 0 41,937

ASSOCIATE GENERAL COUNSEL

SHERRI R EWING40 0 X 232,049 0 32,380

ASSOC CHIEF NRSE EXEC HOSP

MORLEY I KERSCHNER40 0 X 237,195 0 29,057

ADMINISTRATOR REVENUE CYCLE

PHILIP V SPINA40 0 X 231,259 0 44,795

SENIOR VP &COO RSCH CTR

990 Return ofOrganization...

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