Introduction to the Template Governance Decision Authorities Matrix

Introduction to the Template Governance Decision Authorities Matrix • This template is provided only as a starting point for customization. • It is not meant to represent how any one system should delegate responsibilities and authorities nor does it reflect legal or regulatory conditions applicable to all systems. • The template does not include all responsibilities for which you may wish to specify decision-making roles and authorities. Instead, for each section, a sample starting list is provided. You should modify, add, and delete content as needed. IMPORTANT It is essential that legal counsel be actively involved in the development of the Governance Decision Authorities Matrix and hold final approval authority for its recommendation to the Board. Legal Counsel should ensure that the Matrix is clear and conforms to the Bylaws, all state and federal laws, and all regulatory requirements. INSERT ORG NAME HERE– Governance Decision Authorities Matrix

Introduction to the Template Governance Decision Authorities Matrix A Governance Decision Authorities Matrix serves to articulate the authorities and roles around major decision making for: • • • Corporate Member, if relevant The health system board Direct subsidiary boards (As relevant) system committees The health system CEO Fiduciary Responsibilities Matrix is typically organized around: • • • Mission/Strategic Planning Governance Quality Policy/Oversight Financial & Compliance Policy/Oversight Community Benefit & Advocacy Executive Oversight If You Decide to Include a Column for “System Committees” • • The responsibilities outlined in this template Matrix focus on implementation responsibilities for major policies approved by a Board, a Committee, or elsewhere within the governance structure. The Matrix should be used in conjunction with Committee Charters for a more complete understanding of delegated governance roles and responsibilities. ‒ Many additional responsibilities that are not outlined in this template Matrix typically are delegated to Committees. INSERT ORG NAME HERE– Governance Decision Authorities Matrix

Governance Decision Authorities Matrix First Step: With Legal Counsel, Define Preferred Terminology & Identify Examples to Help Clarify “How to Read the Matrix” Terminology Ratify Approve Participate Responsible Definition Examples/Commentary (Typically held by Corporate Member, if any). To have final decision-making authority but without the power to initiate or change a recommendation. Corporate Member must ratify System Mission and Vision. To review and make the final decision (accept, adopt, amend, disapprove, modify, or send back for further consideration), acting in a manner that reflects the system’s mission, vision, and values and is in the best interest of the system; monitor effectiveness of those responsible for carrying out the decision. (If a Corporate Member exists, for relevant responsibilities the System Board may “approve and recommend. ”) System Board approves the System strategic plan and approves or disapproves recommendations from its Committees or the CEO/management. To directly participate in discussion, development, and/or evaluation processes. Where indicated, includes formulating a recommendation for System Board approval. System Governance Committee participates by reviewing and recommending to the System Board a slate of Board nominees. To be fully accountable for implementing, monitoring, and/or evaluating. Management is delegated many responsibilities for implementing Board policies. If a Corporate Member exists, for relevant responsibilities the System Board may “approve and recommend. ” May be used by System Board where regulatory compliance requires a formal hospital/subsidiary board approval. Most approval authorities are retained by the System Board. The matrix outlines when a specific authority or within what limits an authority is delegated to or exercised by a subsidiary board, management, or a committee. Finance Committee participates by reviewing and recommending to the System Board annual operating and capital budgets. Committees are delegated many responsibilities for monitoring or evaluating performance to ensure that the organization is achieving its objectives. Provide Input/ Receive Information To receive information and provide comments that are appropriate or necessary to the System Board, the System Chair, the System CEO, or other System senior management. INSERT ORG NAME HERE– Governance Decision Authorities Matrix Governance Committee provides input to the System Board Chair related to his/her appointment of Board Committee members/Chairs.

INSERT SYSTEM NAME HERE Governance Decision Authorities Matrix Responsibility Corporate Member System Board Direct Subsidiary Board Content is illustrative System Committee System CEO MISSION/STRATEGIC PLANNING • Development of or revision to System’s Mission and Values Approve • System Vision and Strategic Plan • Agreement of consolidation or merger for System or any subsidiary Ratify (for System consolidation/ merger) • Significant investments in businesses, joint ventures, mergers, acquisitions, and other business combinations involving System or any subsidiaries • Determination of service portfolio including discontinuation, addition, or expansion of programs, services, and initiatives offered Participate (recommend) Approve Input Approve* Approve for Entity (ratify for subsidiaries) (recommend) Finance Committee Participate Approve Participate Input (re: impact on entity) Participate (recommend) & Responsible Finance Committee Participate (recommend) Participate (evaluate) *May also require recommendation if there is a Corporate Member. Ratify (Typically held by Corporate Member, if any). To have final decision-making authority but without the power to initiate or change a recommendation. Approve To review and make final decision (approval or disapproval), acting in a manner that reflects System' Mission, Vision, and Values and is in the best interest of the system; monitor effectiveness of those responsible for carrying out the decision. Participate To directly participate in discussion, development, and evaluation processes. May include formulating recommendation for System Board consideration. Responsible To be fully accountable for implementing, monitoring, and/or evaluating. Provide Input/ Receive Info To receive information/provide comments that are appropriate or necessary to the System Board, the System CEO, and other System Senior Management. INSERT SYSTEM NAME HERE – Governance Decision Authorities Matrix 4

INSERT SYSTEM NAME HERE Governance Decision Authorities Matrix Responsibility Corporate Member System Board Approve* & Recommend Direct Subsidiary Board Content is illustrative System Committee System CEO GOVERNANCE • Appointment and/or removal of Directors of the Corporation • Appointment and/or removal of Directors of Direct Subsidiaries Approve • Establishment of Committees of the Board • Appointment and/or removal of Chairs and members of all Standing Committees and all special committees • Revisions to or restatements or repeal of Bylaws or Articles of Incorporation for System Participate (recommend) Approve entity level System Board Chair Entity Board Chair for System Cmtes for Entity Cmtes Approve Ratify Participate (recommend) System level Appoints • Revisions to Governance Authorities Matrix Gov. Committee Approve* Appoints Gov. Committee Participate (recommend) Gov. Committee Participate Gov. Committee Input (recommend) Input Participate (recommend) *May also require recommendation if there is a Corporate Member. INSERT SYSTEM NAME HERE – Governance Decision Authorities Matrix 5

INSERT SYSTEM NAME HERE Governance Decision Authorities Matrix Responsibility Corporate Member System Board Direct Subsidiary Board Content is illustrative System Committee System CEO QUALITY POLICY/OVERSIGHT • Development of a multi-year System Quality & Value Work Plan with long-term and annual improvement targets • Development of performance objectives and plans for sustaining high levels of physician, employee, and patient satisfaction • Establishment of standards for practitioner credentialing across the health system Approve including entity “Quality Improvement Programs” Approve & Recommend Entity “Quality Improvement Programs” Approve Participate (approve) for Entity Quality/ Value Cmte Participate (recommend) Participate Quality/ Value Cmte Participate (recommend) Responsible Quality/Value Cmte Participate (recommend) Responsible • Appointments, reappointments, or revocation or restrictions of appointment to the Hospital Medical Staff, upon recommendations from the Hospital Medical Executive Committee Approve Responsible • Amendments to Hospital Medical Staff Bylaws, prepared by the Medical Staff Approve Participate *May also require recommendation if there is a Corporate Member. INSERT SYSTEM NAME HERE – Governance Decision Authorities Matrix 6

INSERT SYSTEM NAME HERE Governance Decision Authorities Matrix Responsibility Corporate Member System Board Direct Subsidiary Board Content is illustrative System Committee System CEO FINANCIAL & COMPLIANCE POLICY/OVERSIGHT • Establishment of annual System operating and capital budget Approve • Establishment of or revisions to System Investment policies Approve • Establishment or revisions to Retirement Plan policies Approve Finance Cmte (recommend) Participate Finance Cmte Participate (recommend) Participate Finance Cmte • Incurrence of debt (including but not limited to loans, notes, bonds, and mortgages) • Sale, lease, exchange, or other disposition of all or substantially all of the property and assets of the Corporation Participate (recommend) Ratify if >50% of System property or assets • Approval of annual compliance plan *May also require recommendation if there is a Corporate Member. INSERT SYSTEM NAME HERE – Governance Decision Authorities Matrix Finance Cmte Approve if entity’s revenues or assets are pledged/ encumbered (recommend) Approve* (Ratify for subsidiaries) Participate Finance Cmte (recommend) for entity’s assets Participate (recommend) Participate Compliance Cmte Approve Participate (recommend) (Continued) 7

INSERT SYSTEM NAME HERE Governance Decision Authorities Matrix Responsibility Corporate Member System Board Content is illustrative Direct Subsidiary Board System Committee Approve Quality/Value Cmte System CEO COMMUNITY BENEFIT & ADVOCACY • Adoption of Community Health Needs Assessment(s) (CHNAs) developed in compliance with federal, stat, and/or regulatory requirements Information • Adoption of CHNA Implementation Plan, consistent with requirements of federal, state, and/or regulatory requirements • Establishment of overall System philanthropic/ fundraising plan • Establishment of annual goals for system’s public advocacy efforts, including interactions and participation with state and local government Hospital CHNA Report Input & Coordination Approve Quality/Value Cmte Hospital CHNA Implementation Plan Approve Input & Coordination Finance Cmte Input Responsible *May also require recommendation if there is a Corporate Member. INSERT SYSTEM NAME HERE – Governance Decision Authorities Matrix 8

INSERT SYSTEM NAME HERE Governance Decision Authorities Matrix Responsibility Corporate Member System Board Ratify Approve* Direct Subsidiary Board Content is illustrative System Committee System CEO EXECUTIVE OVERSIGHT • Selection and appointment of System CEO Exec Comp Recommend • Selection and appointment of senior management other than System CEO Information • Establishment of total compensation philosophy and compensative practices for senior executives Approve Exec Comp Recommend & Monitor Participate • Retention of qualified independent compensation consultant and other expert advisors as the Executive Compensation Committee deems necessary to fulfill its responsibilities; and determination of the compensation of such advisors Information Exec Comp Approve Input • For System CEO: Annual performance objectives, performance assessment, and determination of total compensation package including any variable pay awards • For senior management other than System CEO: Annual performance objectives, performance assessment, and determination of base compensation Input Approve (Entity President) Exec Comp Participate Approve Input (Entity President) Input goal setting & (recommend) perf. Evaluation Exec Comp: Input Approve *May also require recommendation if there is a Corporate Member. INSERT SYSTEM NAME HERE – Governance Decision Authorities Matrix 9