Return of Organization Exempt from Income Tax .V. Lb M

.V. lb Return of Organization Exempt From Income Tax Form 990 Under section 601(c), 527, or 4947(aXl) of the Internal Revenue Code (except black long 200 benefit trust or private foundation) Department of the Treasury Open to Pubi may have to use a copy of this return to satisfy state reDortina requirements. Inspection Intsnei Revenue servloe ► The organization A For the 2007 calendar year , or tax year beginning an

B a,ed< if C Name of organization D Employer Identification number applicable please use IRS

C]Cas pd «INOVA HEALTH SYSTEM FOUNDATION 7`!-1V /1UV I Nme tym Number and street (or P.O. box If mail is not delivered to street address) Room/sude E Telephone number saesea F-1reeiu, aflc 2 9 9 0 TELESTAR COURT , FOURTH FLOOR 703-28 9 -2433 Insbuo- E3 In- t City or town, state or country, and ZIP + 4 F Aaounbng method Q Cash ® Awuat Orn°tu^nda° FALLS CHURCH . VA 2 204 2 Q^PPdnfppen "C1O" • Section 501(c)( 3) organizations and 4947( ax1) nonexempt charitable trusts H and I we not applicable to section 527 organizations. must attach a completed Schedule A (Form 990 or 990-EZ). H(s) Is this a group return for affiliates? =Yes ®No H(b) If'Yes; enter number N/A J Organization type (cal Only one) ► ® 501(c) ( 3 ) 14 Mart no) Q 4947(ax1) or [] H(c) Are all affiliates included? N/A =Yes =No (If 'No,* attach a list) K Check here ► 0 if the organization is not a 509(a)(3) supporting organization and its gross H(d) Is this a separate return filed by an or- receipts are normally not more than $25,000. A return Is not required, but if the organization chooses to file a return, be sure to file a complete return.

M Check ► J If the organization is not required to attach L Gross receipts: Add lines 6b, 8b, 9b, and 10b to line 12 lo, 170,401,001. Sch. B (Form 990, 990-FZ, or 990-PF). a^art I I Revenue. Expenses. and Chances in Net Assets or Fund Balances 1 Contributions, gifts, grants, and similar amounts received: a Contributions to donor advised funds 18 b Direct public support (not included on line 1a) 1b 9 , 294 , 231. c Indirect public support ( not Included on line ia) to d Government contributions (grants) (not included on line 1a) td e Total (add lines la through 1d) (cash $ 5,298 , 876. noncash $ 3,995,355. ).. to 9 , 294 , 231. 2 Program service revenue including government fees and contracts (from Part VII, line 93) 2 3 Membership dues and assessments . - .. .. - - 3 17 , 704. 4 Interest on savings and temporary cash investments - 4 50 , 846 , 945. 5 Dividends and interest from securities ...... -- .- .. ..- .--- .•...... 5 1 47 2 14 . 6 e Gross rents Ba b Less: rental expenses - 6b c Net rental income or (loss). Subtract line 6b from line 6a ...... 60 7 Other investment income (describe ► SHE STATEMENT 1 ) 7 9 , 867 , 886. 8 a Gross amount from sales of assets other A Securities B Other than Inventory 92 , 037 , 094. 8a b Less: cost or other basis and sales expenses 8b m c Gain or (loss) (attach schedule) ...... 9 2 , 037 , 0 9 4. 8c d Net gain or (loss). Combine line 8c, columns (A) and (B) --- . ....TNT .2 ------8d 92 . 0 3 7 . 094. C7 9 Special events and activities (attach schedule ). If any amount Is from gaming, check here 171 ► a-) a Grour enue(notiadudmg$ 0. ofcoomboeoosmportedoounelb ) 9a 2 . 999 . 027 . CN:p b Less: direct expenses other than fundraising expenses ...... 9b 1 , 500 , 330 . e Net Income or (loss) from special events. Subtract line 9b from line 9a -- -.-, • ---SFB . ST4^ATRM^T. 3.. go 1 , 498 , 697. N 10 a Gross sales of inventory, less returns and allowances -- ... ton O 3 819 5 6 4 . 0 b Less: cost of goods sold - , . 00 10b 1 , 719 , 145. e Gross profit or (loss) from sales of inventory (attach schedule). Subtract line 10b from line 10a ,STT...4 -•- 100 2 , 100 , 4 1 9. 11 Other revenue (from Part VII, line 103) • 11 45 63 6 . 12 Total revenue . Add lines le 2 3. 4. 5 6c 7 8d 9c 10c and 11 ...... 12 167 , 181 526. 13 Program services (from line 44, column (8)) RE^BV E D- 13 12 , 244 , 744. 14 Management and general (from line 44, column (C)) U ..-. 14 7 , 126 , 804. 15 Fundraising (from line 44, column (D)) Q 15 5 , 108 215. 16 Payments to affiliates (attach schedule) NOV 1 2+ 100$ 18 17 Total expenses . Add lines 16 and 44, column (A) ...... • ...... „•. .-....• 17 24 4 7 9 763. 18 Excess or (deficit) for the year . Subtract line 17 from line 12 UT 18 142 , 701 . 763. 19 Net assets or fund balances at beginning of year (from II 19 1015686476. ZQ 20 Other changes in net assets or fund balances (attach explanation ) . .SEE . STATEN= S 20 21 , 0 48 , 285. ,^^M 21 Net assets or fund balances at end of year. Combine lines 18, 19, and 20 21 117 9 43652 4 . 12-27-07 u-A or rnvacy Act and Paperwont Reduction Act Notice , see the separate Instructions. Form 990 (2007) 617 for section 501(c)(3) jPart II Statement of All organizations must complete column (A). Columns (B), (C), and (D) are required Functional Expenses and (4) organizations and section 4947(a)(1) nonexempt charitable trusts but optional for others. Program (C) Management Do not include amounts reported on line (A) Total (B) (D) Fundraising 6b, 8b, 9b, 10b, or 16 of Part I. services and general

22a Grants paid from donor advised funds (attach schedule) ...... (cash $ 0. noncash $ 0. M this amount Includes foreign check he ► ED 2a 22b Other grants and allocations (attach schedule STATEMENT 7 (cash s 113 814 9 2 nO,caSh s 0. if this amount Includes foreign Wants, check here ► U 22b 11 381 492 . 11 , 381 , 492. 23 Specific assistance to individuals (attach schedule) ...... 28 24 Benefits paid to or for members (attach schedule) ...... 24 25a Compensation of current officers, directors, key employees, etc. listed In Part V-A ...... 25a 0. 0. 0. 0. b Compensation of former officers, directors, key employees, etc. listed in Part V-B ...... 25b 0. 0. 0. 0. c Compensation and other distributions, not included above, to disqualified persons (as defined under section 4958(f)(1)) and persons described in section 4958(c)(3)(B) ...... , 50 26 Salaries and wages of employees not included on lines 25a, b, and c., 26 3 , 062 , 187. 324 . 148. 2 , 738 , 039. 27 Pension plan contributions not included on lines 25a, b, and c ...... 27 28 Employee benefits not included on lines 25a-27,..- ..,..,... 28 463 802. 29 , 195. 434 607. 29 Payroll taxes ., . 29 30 Professional fundraising fees ...... a0 31 Accounting fees ...... 81 32 Legal fees ...... 82 33 Supplies .38 135 019. 46 160. 88 859. 34 Telephone a4 21 8 6 7 . 12 12 9 . 9 7 3 8 . 35 Postage and shipping 85 7 2 8 7 4 . 10 47 0 . 6 2 40 4 . 38 Occupancy 36 587 07 . 483 028. 104 047 . 37 Equipment rental and maintenance 37 7 5 9 3 2. 41 3 9 8. 3 4 5 3 4. 38 Printing and publications 38 211 18 6 . 2 0 12 0 . 191 0 6 6 . 39 Travel 39 60 846. 21 557. 39 289. 40 Conferences, conventions, and meetings -- 3 6 2 5 5. 18 4 5 8. 17 7 9 7. 41 Interest 41 42 Depreciation, depletion, etc. (attach schedule) 42 2 9 8 2 0. 2 6 8 81. 2 9 3 9. 43 Other expenses not covered above (itemize): a a

34 3e Oaf g SEE STATEMENT 6 a 8 , 341 A 08. 6 , 956 , 512. 1 , 384 , 896. 44 Total functional expenses . Add lines 22a through 43g. (Organizations completing columns (B)-(D), car these totals to lines 13-15 ...... - 44 24 , 479 7 6 3. 12 2 4 4 7 4 4. 7 , 126 , 804. 5 , 108 , 215. Joint Costs. Check ► U if you are following SOP 98-2. Are any joint costs from a combined educational campaign and fundraising solicitation reported in (8) Program services? . ► Q Yes ® No If 'Yes; enter (1) the aggregate amount of these pint costs $ N/A ; (ii) the amount allocated to Program services $ N/A Will the amount allocated to Management and general $ N/A ' and IIv) the amount allocated to Fundraising $ N/A 729011 12-21.07 Form 990 (2007) Form ments (See the

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

What is the organization 's primary exempt purpose? ► Program Service SEE ATTACHED SCHEDULE Expenses (Required for 501(c)(3) All organizations must describe their exempt purpose achievements in a clear and concise manner. State the number of and (4) orgs., and clients served , publications issued, etc. Discuss achievements that are not measurable. (Section 501 (c)(3) and (4) 4947(a)(1) trusts; but organizations and 4947(a)(1) nonexempt charitable trusts must also enter the amount of grants and allocations to others.) optional for others.) a SEE ATTACHED SUPPORTING SCHEDULE

(Grants and allocations $ 11 3 81 4 9 2 . If this amount includes foreign rants check here Bo, U 12 , 244 , 744. b

Grants and allocations $ If this amount includes forei n rants check here lli^ C

Grants and allocations $ If this amount includes foreign rants check here ► d

Grants and allocations $ If this amount includes foreign rants check here 10* e Other program services (attach schedule) Grants and allocations $ If this amount includes foreign rants check here 0 f Total of Program Service Expenses (should equal fine 44, column (B), Program services) ► 12,244,744. Form 990 (2007)

723021 12-27-07 Form 990 (^007) INOVA HEALTH SYSTEM FOUNDATION 54-1071867 Paste4 Part IV I Balance Sheets (see the instructions.) Note : Where required, attached schedules and amounts within the description column (A) (B) should be for end-of-year amounts only. Beginning of year End of year

45 Cash - non-interest-bearing ...... 45 48 Savings and temporary cash investments ...... 1694433588. 48 1914253282.

47 a Accounts receivable ...... 47a 889 , 513. b Less : allowance for doubtful accounts ..• •. _ .. 47b 8 45 , 762. 47c 889 , 513.

48 a Pledges receivable .... _. _,_ ••.•.._.. _•. • .. 48a 10 , 483 , 179. b Less: allowance for doubtful accounts 48b 1 , 88 6 , 496. 6,704 .865. 48c 8 , 596 , 683. 49 49 Grants receivable • ...... 50 a Receivables from current and former officers , directors , trustees, and key employees ,,, •• , ...... 50s b Receivables from other disqualified persons (as defined under section 4958(f)(1)) and persons described in section 4958(cX3 B) ...... 50b 51 a Other notes and bans recevablei ,•_ •,•••,•., ,. 51a b Less: allowance for doubtful accounts 51b 62 Inventories for sale or use ...... _...... - 182 801. 52 156 308. 53 Prepaid expenses and deferred charges ...... •...... •_...... ••• _.. 25 , 054. 58 30 , 755. 54 a Investments - publicly-traded securities ...... , •,•, ► 0 Cost Q FMV 542 b Investments - other securities .... •„ ► Cost 0 FMV 54b 55 a Investments - land, buildings, and equipment : basis ••• „_ , ,_•_ , • .,•• „ ,,..___•• •... 558

b Less accumulated depreciation 55b 550 56 Investments - other ...... SEE STATEMENT..8 .... 36 , 567 , 490. 56 48 , 231 , 115. 57 a Land , buildings , and equipment . basis ...... 57a 2 , 538 , 864. b Less : accumulated depreciation . ._ •_ .... 57b 186 , 389. 2 , 376 , 298. 57c 2 , 35-2 , 475. 58 Other assets, including program-related investments (describe ' DEPOSITS RECEIVABLE ) 3 . 250 . 58 3 , 250. 59 Total assets (must equal line 74). Add lines 45 through 58 ...... 1741139108. 59 1974513 3 81. 60 Accounts payable and accrued expenses .., •.. • • ., • , •• •. • .938 , 696. 60 419 7 6 9 . 81 Grants payable 62 Deferred revenue 63 Loans from officers , directors , trustees, and key employees ...... • 63 64 a Tax-exempt bond liabilities 64a b Mortgages and other notes payable 64b 65 Other liabilities (describe ► SEE STATEMENT 9 ) 513 9 3 6. 5 7 9 4 6 5 7 0 8 .

68 0 l liabilit' s Add lines 60 throw h 65 4 5 2 6 3 2. 86 7 5 0 7 6 8 5 7. Organizations that follow SFAS 117, check here ® and complete lines 67 through 69 and lines 73 and 74 87 unrestricted 511 2 8 4. o7 112 8 613 7 4 0. 68 Temporanyrestricted 6a 50 , 822 , 784. 69 Permanently restricted ...... 69 Organizations that do not follow SFAS 117, check here ► LI and U. complete lines 70 through 74 70 Capital stock, trust principal , or current funds , ,•.• •._ •• .•. . _• 70 71 Paid-in or capital surplus , or land , building , and equipment fund ...... 71 72 Retained earnings , endowment , accumulated income , or other funds 72 73 Total net assets or fund balances . Add lines 67 through 69 or lines 70 through 72.

(Column (A) must equal line 19 and column (B) must equal line 21) •• •• • _ . 10156 86 476. 78 117 94 36524. 74 Total liabilities and net assetslfund balances . Add lines 66 and 73 174113 9 108. 1 74 1 9 7451 3 38 1. Form 990 (2007)

723031 12-27-07 ...,oonr0nrn ► TNnVA HRAT .TH SYSTRM VnTTNT ATTON 54-1071867 Paae5 Part IV-A Reconciliation of Revenue per Audited Financial Statements With Revenue per Return (See the instructions.)

a Total revenue , gains , and other support per audited financial statements ...... , ...... a 214071 b Amounts included on line a but not on Part I, line 12: 1 Net unrealized gains on investments ...... b1 2 Donated services and use of facilities ...... b2 3 Recoveries of prior year grants ...... b3 4 Other (specify): SEE STATEMENT 10 b4 1973537474. Add lines bi through b4 ...... b 19735' c Subtract fine b from line a ...... a 16711 d Amounts included on Part 1 , line 12, but not on line a: 1 Investment expenses not included on Part I , line 6b ...... dl 2 Other (specify): d2 Add lines dl and d2 d

a Total expenses and losses per audited financial statements ...... a 1 tS 4 b b 4.S U b Amounts included on line a but not on Part 1, line 17: 1 Donated services and use of facilities ...... „_. ,_,,.., . ,.. ,...... ,., , .. b1 2 Prior year adjustments reported on Part I, line 20 ...... b2 3 Losses reported on Part 1, line 20 ...... b3 4 Other (specify): SEE STATEMENT 11 b4 1822163237. Add lines bi through ba ...... b 18 2 216 3 2 c Subtract line b from line a ...... c 24 , 479 , 7 d Amounts included on Part I, line 17, but not on line a: 1 Investment expenses not included on Part I, line 6b ...... d1 2 Other (specify): d2 Add lines di and d2 ...... d

PO" V-A I current vrncers, uirectors, trustees, ana Key Employees (List each person who was an officer, director, trustee, or kev emolovee at any time during the year even if they were not comoensated.1(See the instructions.) (B) Title and average hours (C) Compensation (D Contnbutfons to (E) Expense (A) Name and address per week devoted to ,Pia,P'O (If not paid, enter defarredt account and position .,,,, n plans other allowances ------SEE STAT 12 0. 0. 0. ------

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Form 890 (2007) 723041 12-27-07 C r__..nnnrnnnr T13V% 7 uP T.'PU C VCP M FfVTWfhrPT A1 rid-1 n71 RFi7 PAnaa FP-art--V--:A--j-Current Officers, Directors, Trustees, and Key Employees (continued) Yes No 75 a Enter the total number of officers , directors , and trustees permitted to vote on organization business at board 21 meetings ...... ► b Are any officers , directors , trustees , or key employees listed in Form 990 , Part V-A, or highest compensated employees listed in Schedule A, Part I, or highest compensated professional and other independent contractors listed in Schedule A, Part II-A or II-B, related to each other through family or business relationships? If 'Yes,' attach a statement that identifies the individuals and explains the relationship(s) ...... 75b X

c Do any officers , directors , trustees , or key employees listed in Form 990 , Part V-A, or highest compensated employees listed in Schedule A, Part 1, or highest compensated professional and other independent contractors listed in Schedule A, Part II-A or II-B, receive compensation from any other organizations , whether tax exempt or taxable, that are related to the organization ? See the instructions for the definition of 'related organization.' ...... 760 X If 'Yes,' attach a statement that includes the information described in the instructions d Does the or anization have a writte n conflict of Interest policy? 75d X Part V-B Former Officers. Directors. Trustees. and Kev Emulovees That Received Comoensation or Other Benefits (if any former officer, director, trustee, or key employee received compensation or other benefits (described below) during the year, list that person below and enter the amount of compensation or other benefits in the appropriate column . See the mstrucbons.) (C) Compensation (D) contributions to (E) Expense Name and address (B) Loans Advances (rf not employee benefd (A) and paid, Plans aecidefierr account and NONE enter -0-) won plans other allowances ------

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------Part VI Other Information (See the instructions.) Yes No 76 Did the organization make a change in its activities or methods of conducting activities ? If 'Yes, ' attach a detailed statement of each change ...... 77 Were any changes made in the organizing or governing documents but not reported to the IRS? 77 X If 'Yes,' attach a conformed copy of the changes. 78 a Did the organization have unrelated business gross income of $1,000 or more during the year covered by this return? . , _ .. . 78a X b If 'Yes ,' has it filed a tax return on Form 990-T for this year? ,...... NJA 78b 79 Was there a liquidation , dissolution , termination , or substantial contraction during the year? If 'Yes ,' attach a statement .... 79 X 80 a Is the organ ization related (other than by association with a statewide or nationwide organization) through common membership, governing bodies , trustees , officers, etc., to any other exempt or nonexempt organization? ...... 80a X b If 'Yes ,' enter the name of the organization '. SEE STATEMENT 13 and check whether it is Q exempt or 0 nonexempt 81 a Enter direct and indirect political expenditures . (See line 81 instructions ) ,.....,.. 81a 0. - b Did the o anization file Form 1120-POL for this year? ...... 1b X Form 990 (2007)

723161 /12-27-07 -1 0 71867 Page 7 Yes No

82 a Did the organization receive donated services or the use of materials , equipment , or facilities at no charge or at substantially less than fa ir rental value? ...... b If Yes,' you may indicate the value of these items here. Do not include this amount as revenue in Part I or as an expense in Part II. (See instructions in Part III.) ...... 182b I N/A 83 a Did the organization comply with the public inspection requirements for returns and exemption applications? ...... b Did the organization comply with the disclosure requirements relating to quid pro quo contributions ? „ ...... „ .. 84 a Did the organization solicit any contributions or gifts that were not tax deductible ? ...... NSA...... b If Yes,' did the organization include with every solicitation an express statement that such contributions or gifts were not tax deductible? ...... /A ...... 85 a 501 (c)(4), (5), or (6). Were substantially all dues nondeductible by members? ..., ...... N/A .... „ lobbying expenditures of or ...... b Did the organization make only in-house $2,000 less? '**...... N a ...... If Yes' was answered to either 85a or 85b , do not complete 85c through 85h below unless the organization received a waiver for proxy tax owed for the prior year. c Dues , assessments , and similar amounts from members . , _...,,, , „ ...... 85o N / A d Section 162(e) lobbying and political expenditures ...... 85d N / A a Aggregate nondeductible amount of section 6033(e)(1)(A) dues notices ...... He N /A f Taxable amount of lobbying and political expenditures Pine 85d less 85e) ...... 85f N / A g Does the organ ization elect to pay the section 6033 (e) tax on the amount on line 85f? ...... N/.A...... _ it If section 6033(e)(1)(A) dues notices were sent, does the organization agree to add the amount on line 85f to its reasonable estimate of dues allocable to nondeductible lobbying and political expenditures for the following tax year? ...... /A.... 88 501(c)(7) organizations. Enter: a Initiation fees and capital contributions included on line 12 b Gross receipts, Included on line 12, for public use of club facilities 87 501(c)(12) organizations. Enter: a Gross income from members or shareholders ...... D Gross income from other sources. (Do not net amounts due or paid to other sources against amounts due or received from them.) ...... 87b N / A 88 a At any time during the year, did the organization own a 50% or greater interest in a taxable corporation or partnership, or an entity disregarded as separate from the organization under Regulations sections 301.7701-2 and 301 77013? If 'Yes,' complete Part IX ...... -...... 88a X ...... it At any time during the year, did the organization,...... directly or indirectly, own a controlled entity within the meaning of section 512(b)(13)? If 'Yes,' complete Part XI ...... , ,,,. , ,... ► 88b X 89 a 501(c)(3) organizations. Enter: Amount of tax imposed on the organization during the year under: section 4911 Boo- section 4912 0 . ; ► 0 . ; section 4955 ► 0. b 501(c)(3) and 501(c)(4) organizations. Did the organization engage in any section 4958 excess benefit transaction during the year or did it become aware of an excess benefit transaction from a prior year? If "Yes,' attach a statement explaining each transaction ...... 89h X e Enter: Amount of tax imposed on the organization managers or disqualified persons during the year under sections 4912, 4955, and 4958 100. 0. d Enter: Amount of tax on line 89c, above, reimbursed the by organization ...... ► 0. e All organizations. At any time during the tax year, was the organization a party to a prohibited tax shatter transaction? _...... 896 X f All organizations. Did the organization acquire a direct or indirect interest in any applicable insurance contract?...... - X g For supporting organizations and sponsoring organizations maintaining donor advised funds. Did the supporting organization, or a fund maintained by a sponsoring organization, have excess business holdings at any time during the year? ... .., X 90 a List the states with which a copy of this return is filed b Number of employees employed in the pay period that includes March 12, 2007 90b 30 91 a The books are in care of INOVA HEALTH ► SYSTEM FOUNDATION Telephone no. ► (703) 2 8 9 - 2 4 3 3 Located at ► 2990 TELESTAR COURT FALLS CHURCH VA ZIP + 2 2 0 4 2 it At any time during the calendar year, did the organization have an interest in or a signature or other authority over Yes No a financial account in a foreign country (such as a bank account, securities account, or other financial account)? ...... 91b X If 'Yes,' enter the name of the foreign country ► N/A See the instructions for exceptions and filing requirements for Form TD F 90-22.1, Report of Foreign Bank

Form 990 (2007)

723102 / 12-27-07 '7 Form 990 007 INOVA HEALTH SYSTEM FOUNDATI ON 54-1071867 Pa e 8 Part VI , Other Information (continued) Yes No_ e At any time during the calendar year , did the organization maintain an office outside of the United States? 1910 l 1 X If 'Yes,' enter the name of the foreign country ► N/A 92 Section 4947(a)(1) nonexempt charitable trusts filing Form 990 in lieu of Form 1041 - Check here ...... I...... ► 0 interest received or accrued during the tax year ...... and enter the amount of tax-exempt ► 192 L N/A Part VII I Analysis of income-Producing Activmes (See the instructions) Note: Enter gross amounts unless otherwise 111tl Indicated. (A) (B) ECII (0 ) Related or exempt Business Amount , Amount 93 Program service revenue: code function income a b e d e f Medicare/Medicaid payments ...... g Fees and contracts from government agencies ... 94 Membership dues and assessments ...... 95 Interest on savings and temporary cash investments ., 96 Dividends and interest from securities ...... 97 Net rental income or (loss) from real estate: a debt-financed property,,...... ,• ...... b not debt-financed property .__.. •,• •, . • ...... _.... 98 Net rental income or (loss) from personal property 99 Other investment income 100 Gain or (loss) from sales of assets other than inventory , .,,,...,, ...... 101 Net income or (loss) from special events ...... 102 Gross profit or (loss) from sales of inventory 103 Other revenue. a MISCELLANEOUS b C d e 104 Subtotal (add columns (B) , (D), and (E)) ...... 0- 1 157157,869,' 5 91. 17 , 7 0 4 . 105 Total (add line 104 , columns (B), (D), and (E)) ..,•_ • .... ► 157,887,295. Note: Line 105 plus line le, Part 1, should equal the amount on line 12, Part Part VIII Relationship of Activities to the Accomplishment of Exempt Purposes (see the instructions) Line No . Explain how each activity for which income is reported in column (E) of Part VII contributed importantly to the accomplishment of the organization's V exempt purposes (other than by providing funds for such purposes). 94 MEMBERSHIP DUES RELATED TO PROGRAM SERVICE ACTIVITY. 99 - PARTNERSHIP INCOME RELATED TO EXEMPT ACTIVITY

Part IX Information Regarding Taxable Subsidiaries and Disregarded Entities (see the instructions.) (A) (8 ) () ( ) Name, address, and EIN of corporation, Percentage of Nature of activities Total income End-of ear partnership, or disre garded entity ownership interest SEE STATEMENT 14 % ^o

Part X Information Reaardina Transfers Associated with Persnnal Benefit enntrar,ts gem i (a) Did the organization, during the year, receive any funds, directly or indirectly, to pay premiums on a personal benefit contract? [] Yes ®No (b) Did the organization , during the year, pay premiums, directly or indirectly, on a personal benefit contract? 0 Yes ® No Note: If 'Yes' to (b), file Form 8870 and Form 4720 (see instructions). Form 990 (2007)

723163 12-27-07

0 Form 990 (2007) INOVA HEALTH SYS TEM FOUNDATION 5 4-1 0 71 8 67 Page 9 Part X1 . Information Regarding Transfers To and From Controlled Entities. Complete only if the organization is a control) no oroanaation as defined in section 512(b)(13). Yes No 108 Did the reporting organization make any transfers to a controlled entity as defined in section 512 (b)(13) of the Code? If 'Yes,' com plete the schedule below for each controlled entity. X (A) (B) (C) (D) Name, address, of each Employer Description of Amount of Identification controlled entity Number transfer transfer INOVA------HEALTH CARE SERVICES a 2990 TELBSTAR COURT FALLS CHURCH , VA 22042 54-0620889 EE STATEMENT 15 58471145. AL------EXANDRIA HEALTH SERVICES CORPORATI b 2990 TELESTAR COURT FALLS CHURCH , VA 22042 52-1356573 9 , 545 , 315. INOVA HOLDINGS,_INC______TELESTAR COURT c 2990------ALLS CHURCH V-A- 22042 51-0332880 705 930.

Totals 68722390. Yes No 107 Did the reporting organization receive any transfers from a controlled entity as defined in section 512(b)(13) of the Code? If 'Yes,' com plete the schedule below for each controlled entity. X (A) (B) (C) (D) Name, address, of each Employer Description of Amount of Identification controlled entity Number transfer transfer OUDOUN_HEALTHCAREJ-INC.__-______a 2990 TELESTAR COURT______FALLS CHURCH VA 22042 54-1361309 BB STATEMENT 16 2 451 800. INOVA HEALTH SYSTEM_ SERVICES______b 2990 TEL$ST_AR —COURT FALLS CHURCH , VA 22042 54-1434144 16 02924. ------c ------

Totals 18554724. Yes No 108 Did the organization have a binding written contract in effect on August 17 , 2006 , covering the interest , rents , royalties, and annuities described in question 107 above? X under 1Ja1WI v. IS reaan , mauaing accompanying acneaules and statements, and to the best of my knowledge and belief, it is Use, correct, and complete Dec based on all information of which preparer has any knowledge Please I/ /3/U70?- Sign I to Date Here el, Type or Preparers Preparer's SSN or Pu N (See Caen. Inst X) Paid signature Prepare, Firms name (or REZNIC ROUP, PC Use Only yws If loyea address, and 8045 L SBURG PIKE, SU ZIP+4

723184112-27-07 t , SCHEDULE A Organization Exempt Under Section 501 (c)(3) OMB No 1545-0047 (Form 990 or 990-EZ) (Except Private Foundation ) and Section 501(e), 501(f), 501(k), 501(n ), or 4947(IK1) Nonexempt Charitable Trust separate instructions.) Department of "Try Supplementary Information -(See 2007 Internal Revenue Service ► MUST be completed by the above organizations and attached to their Form 990 or 990-EZ Name of the organization Employer identification number

Part I Compensation of the Five Highest Paid Employees Other Than Officers, Directors, and Trustees (See page 1 of the instructions. List each one. If there are none, enter 'None.') (d) Conts!o ( (a) Name and address of each employee paid (b ) Title and average hours e) Expense per week devoted to (e) Compensation employee beneffi account and other more than $50,000 position compensation allowances SARAH BURDI------VP 2990 TELESTAR CT , FALLS CHURCH , VA 40.00 160 398. 32 , 080. 0. LAURA MOSES------SR DIR DEVELO P 2990 TBLBSTAR CT FALLS CHURCH VA 40.0 0 130 472. 26 , 094. 0. ------LINDA ROBERTSON ------SR DIR DEVEL 2990 TSLBSTAR CT FALLS CHURCH VA 40.00 130 336. 26 067. 0. HAL-EPSTEIN ______IRCTR DEVELO P 2990 TELESTAR CT , FALLS CHURCH , VA 40.00 128 574. 25 , 715. 0. CORINNE HABSL ______SR DIR DEVELO P 2990 TBLBSTAR 'i _ FALLS CHURCH VA 40.00 104 879. 20 , 976. 0. Total number of other employees paid over $50,000 . ► 13 Part Il-A Compensation of the Five Highest Paid Independent Contractors for Professional Services (See page 2 of the instructions. List each one (whether individuals or firms). If there are none, enter 'None.')

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

RICHARD BINDER MD------6704- BRADLEY BLVD B$THESDA MA 20817 MEDICAL SERVICES 51 , 521. ------

------

Total number of others receiving over $50,000 for professional services ...... _ Part Il- B Compensation of the Five Highest Paid Independent Contractors for Other Services (List each contractor who performed services other than professional services, whether individuals or firms. If there are none, enter 'None.' See page 2 of the instructions.)

(a) Name and address of each independent contractor paid more than $50,000 (b) Type of service (c) Compensation RITZ_CARLTON_TYSONS______P.O. BOX 759098 , BALTI MORE , MD 21275 HOTEL SERVICES 212 546. VICTOR G._ DYMOWSKI ------6039 EDGEWOOD•-TERRAC$ ALEXANDRIA , VA 22037 FUNDRAISING 66 , 542. ------

------

Total number of other contractors receiving over $50,000 for other services _. ►

723101/12-27-07 LHA For Paperwork Reduction Act Notice , see the Instructions for Form 990 and Form 990-EZ. Schedule A (Form 990 or 990-EZ) 2007 1A Schedule A (Form 990 or 990-EZ) 2007 INOVA HEALTH SYSTEM FOUNDATION 54- FP-air-t--11-11 'Statements About Activities (See page 2 of the instructions.) Yes No

During the year, has the organization attempted to influence national, state, or local legislation, including any attempt to influence public opinion on a legislative matter or referendum? If 'Yes; enter the total expenses paid or incurred in connection with the lobbying activities ► $ $ (Must equal amounts on line 38, Part VI-A, or line I of Part VI-B.) Organizations that made an election under section 501(h) by filing Form 5768 must complete Part VI-A. Other organizations checking 'Yes' must complete Part VI-B AND attach a statement giving a detailed description of the lobbying activities. During the year, has the organization, either directly or indirectly, engaged in any of the following acts with any substantial contributors, trustees, directors, officers, creators, key employees, or members of their families, or with any taxable organization with which any such person is affiliated as an officer, director, trustee, majority owner, or principal beneficiary? (If the answer to any question is 'Yes,' attach a detailed statement explaining the transactions.) a Sale, exchange, or leasing of property? - b Lending of money or other extension of credit? c Furnishing of goods, services, or facilities? ...... •- •------...... • d Payment of compensation (or payment or reimbursement of expenses if more than $1,000)? . •.•• •• - -$$L...STAT$MWT - 17 2d X e Transfer of any part of its Income or assets? -.. ...- .. . .. 2e X 3 a Did the organization make grants for scholarships, fellowships, student loans, etc.? (it 'Yes,* attach an explanation of how the organization determines that recipients qualify to receive payments.) - - . - .. as X b Did the organization have a section 403(b) annuity plan for its employees? . , - . 3b X c Did the organization receive or hold an easement for conservation purposes, including easements to preserve open space, the environment, historic land areas or historic structures? If 'Yes,' attach a detailed statement 3c X d Did the organization provide credit counseling, debt management, credit repair, or debt negotiation services? - - - , 8d X 4 a Did the organization maintain any donor advised funds? If 'Yes; complete lines 4b through 4g. If 'No,' complete lines 4f and 4g ...... 4a X b Did the organization make any taxable distributions under section 4966? N/A, - 4b e Did the organization make a distribution to a donor, donor advisor, or related person? ------N/A 40 d Enter the total number of donor advised funds owned at the end of the tax year - ► N/A e Enter the aggregate value of assets held in all donor advised funds owned at the end of the tax year •• ► N/A f Enter the total number of separate funds or accounts owned at the end of the year (excluding donor advised funds Included on line 4d) where donors have the right to provide advice on the distribution or investment of amounts in such funds or accounts -• ► 0. g Enter the aggregate value of assets in all funds or accounts included on line 4f at the end of the tax year ----- ... ► 0.

Schedule A ( Form 990 or 990-EZ) 2007

723111 12-27-07 1 1 Schedule A (Form 990 or 990-EZ) 2007 INOVA HEALTH SYSTEM FOUNDATION 54-1071867 Page 3 Part IV ` Reason for Non-Private Foundation Status (See pages 4 through 8 of the instructions.)

I certify that the organization Is not a private foundation because it is: (Please check only ONE applicable box) 5 0 A church, convention of churches, or association of churches. Section 170(b)(1)(A)(i). 8 0 A school. Section 170(b)(1)(A)(il). (Also complete Part V.) 7 Ll A hospital or a cooperative hospital service organization . Section 170(b)(1)(A)(iii). 8 Q A federal, state, or local government or governmental unit. Section 170(b)(1)(A)(v). 9 [] A medical research organization operated in conjunction with a hospital. Section 170(b)(1)(A)(m). Enter the hospital's name, city, and state ► 10 O An organization operated for the benefit of a college or university owned or operated by a governmental unit Section 170(b)(1)(A)(iv). (Also complete the Support Schedule in Part IV-A.) 11a [] An organization that normally receives a substantial part of its support from a governmental unit or from the general public. Section 170(b)(1)(A)(vi). (Also complete the Support Schedule in Part IV-A.) lib El A community trust Section 170(b)(1)(A)(vi). (Also complete the Support Schedule in Part IV-A.) 12 El An organization that normally receives: ( 1) more than 33113% of its support from contributions, membership fees, and gross receipts from activities related to its charitable, etc., functions - subject to certain exceptions, and (2) no more than 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). (Also complete the Support Schedule in Part IV-A.)

13 ® An organization that is not controlled by any disqualified persons (other than foundation managers) and otherwise meets the requirements of section 509(a)(3). Check the box that describes the type of supporting organization: 0 Type I 0 Type II ® Type Ill-Functionally Integrated El Type III-Other

Provide the following Information about the supported organizations . (See page 8 of the instructions.) (a) (b) (c) (d) (e) Name(s) of supported organization (s) Employer Type of organization Is the supported Amount of Identification (described In tines organization listed In support number (EIN) 5 through 12 above the supporting or IRC section) organization's governing documents?

Yes No

INOVA HEALTH CARE SERVICES 54-0620889 X 10 719 322.

INOVA HEALTH SYSTEM SERVICES 54-1434144 12 X 387 520.

Total -- ... - ...... 106 842.

14 0 An organization organized and operated to test for public safety. Section 509(a)(4). (See page 8 of the instructions.) Schedule A (Form 990 or 990-EZ) 2007

723121 12-21-07 Page 4 Schedule A (Form 990 or 990-EZ 2007 INOVA H EMLTH SYSTEM FOUM-ATION 5 4- 107 1 867 Part IV-A Support Schedule (Complete only if you checked a box on line 10, 11, or 12.) Use cash method of accounting. N/A W..se• Vna, may ,j the wnrkchaat in tha instnJntinns for nnnvertino fmm the accrual to the cash method of accountina. Calendar year (or fiscal year 2005 a 2004 (d) 2003 a Total bepinhing in .. ► (a) 2006 (b ) 15 Gifts, grants, and contributions recenred. (Do not include unusual grants. See line 28. ) 16 Membershi p fees received 17 Gross receipts from admissions, merchandise sold or services performed, or furnishing of facilities in any activity that Is related to the organization's charitable, etc., purpose ...... 18 Gross income from interest dividends, amounts received from payments on securities loans (section 512(a)(5)rents, royalties, income from similar sources, and unrelated business taxable Income (less section 511 taxes) from businesses acquired by the organization after June 30 , 1975. .•. ---...... 19 Net income from unrelated business activities not included in line 18 20 Tax revenues levied for the organization's benefit and either paid to it or expended on its behalf 21 The value of services or facilities furnished to the organization by a governmental unit without charge. Do not include the value of services or facilities generally furnished to the public without charge 22 Other income. Attach a schedule. Do not include gain or (loss) from sale of capital assets -- ...... 23 Total of lines 15 through 22 0. 0. 0. 0. 0. 24 Line 23 minus line 17 25 Enter 1% of line 23 28 Organizations described on lines 10 or 11 : a Enter 2% of amount in column (e), line 24 ► 28a N / A b Prepare a list for your records to show the name of and amount contributed by each person (other than a governmental unit or publicly supported organization) whose total gifts for 2003 through 2006 exceeded the amount shown In line 26a. Do not file this list with your return . Enter the total of all these excess amounts ...... ► 26b N/A c Total support for section 509(a)(1) test Enter line 24, column (e) ...... -- ► 28o N / A d Add: Amounts from column (e) for lines: 18 19 22 26b ► 28d N / A e Public support (line 26c minus line 26d total) . •. ► 28e N / A f Public su pport percenta ge 28e numerator divided (line by line 26c ( denominator)) ► 28f N / A % 27 Organizations described on line 12: a For amounts included in lines 15, 16, and 17 that were received from a *disqualified person,' prepare a list for your records to show the name of, and total amounts received in each year from, each 'disqualified person.' Do not file this list with your return . Enter the sum of such amounts for each year. (2006) . - •, -- (2005) (2003) - b For any amount included in line 17 that was received from each person (other than 'disqualified personsprepare a list for your records to show the name of, and amount received for each year, that was more than the larger of (1) the amount on line 25 for the year or (2) $5,000. (include in the list organizations described in lines 5 through 11b, as well as individuals.) Do not file this list with your return . After computing the difference between the amount received and the larger amount described in (1) or (2), enter the sum of these differences (the excess amounts) for each year. (2006) ., (2005) . . (2004) - - (2003) c Add: Amounts from column (e) for lines: 15 16 17 20 21 10' 1 270 1 N/A d Add: Line 27a total and line 27b total ► e Public support (line 27c total minus line 27d total) . ... ••. „- .. ► f Total support for section 509(a)(2) test Enter amount on line 23, column (e) - - . ► g Public support percentage (line 27e (numerator ) divided by line 27f (denominator)) h Investment income nercentane (line 18. column ( el (nemerarorl divided by lion 97f Ida 28 Unusual Grants : For an organization described in line 10, 11, or 12 that received any unusual grants during 2003 through 2006, prepare a list for your records to show, for each year, the name of the contributor, the date and amount of the grant, and a brief description of the nature of the grant. Do not file this list with your return . Do not include these grants in line 15. -723131 12-27-07 -- - - - Scheib A (Earn 990 or 990-M 2007 1 7 Schedule A (Form 990 or 990-EZ) 2007 IN VA HEALTH S YSTEM FOUNDATION 54-107 1 867 Page S Part V Private School Questionnaire (See page 9 of the instructions.) N/A (To be completed ONLY by schools that checked the box on line 6 in Part IV)

Yes No 29 Does the organization have a raciallyly nondiscriminatoryry policy toward students by statement in its charter, bylaws, other governing instrument, or in a resolution of its governing body? 29 30 Does the organization include a statement of its racially nondiscriminatory policy toward students in all its brochures, catalogues, and other written communications with the public dealing with student admissions, programs, and scholarships? 30 31 Has the organization publicized its racially nondiscriminatory policy through newspaper or broadcast media during the period of solicitation for students, or during the registration period if it has no solicitation program, in a way that makes the policy known to all parts of the general community it serves? 31 If 'Yes," please describe; if "No,' please explain. (If you need more space, attach a separate statement)

32 Does the organization maintain the following:

a Records indicating the racial composition of the student body, faculty, and administrative staff? . ii. b Records documenting that scholarships and other financial assistance are awarded on a racially nondiscriminatory basis? 82b e Copies of all catalogues, brochures, announcements , and other written communications to the public dealing with student admissions, programs, and scholarships? --- 32c d Copies of all material used by the organization or on its behalf to solicit contributions? ...... 82d If you answered "No' to any of the above, please explain. (If you need more space, attach a separate statement)

33 Does the organization discriminate by race in any way with respect to: a Students' rights or privileges? - - aaa b Admissions policies? - - - - . aab

c Employment of faculty or administrative staff? . .!!c.. d Scholarships or other financial assistance? - aad e Educational policies? • aae f Use of facilities? 331 g Athletic programs? as h Other extracurricular activities? If you answered 'Yes' to any of the above, please explain . ( If you need more space, attach a separate statement)

34 a Does the organization receive any financial aid or assistance from a governmental agency? . . 24a b Has the organization' s right to such aid ever been revoked or suspended9 ... 34b If you answered'Yes' to either 34a or b, please explain using an attached statement 35 Does the organization certify that it has complied with the applicable requirements of sections 4.01 through 4.05 of Rev. Proc. 75-50, 1975-2 587, C.B. covering racial nondiscrimination ? If 'No; attach an explanation 85 Schedule A (Form 990 or 990-EZ) 2007

723141 12-27-07 1 A Schedule A (Form 990 or 990-EZ) 2007 INOVA HEALTH S YSTEM FOUNDATION 54-10718 6 7 Page 8 Part vi-A Lobbying Expenditures by Electing Public Charities (See page 11 of the Instructions.) N/A (To be completed ONLY by an eligible organization that filed Form 5768)

(a) (b) Limits on Lobbying Expenditures Affiliated group To be completed for all (The term 'expenditures' means amounts paid or Incurred.) totals electing organizations

38 Total lobbying expenditures to influence public opinion (grassroots lobbying) - 37 Total lobbying expenditures to influence a legislative body (direct lobbying) 38 Total lobbying expenditures (add lines 36 and 37) - • •• , 39 Other exempt purpose expenditures 40 Total exempt purpose expenditures (add lines 38 and 39) 41 Lobbying nontaxable amount Enter the amount from the following table - It the amount on line 40 is - The lobbying nontaxable amount is - Not over $500,000 20% of the amount on line 40 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 42 Grassroots nontaxable amount (enter 25% of line 41) - 43 Subtract line 42 from line 36. Enter -0- if line 42 is more than line 36 44 Subtract line 41 from line 38. Enter -0- if line 41 Is more than line 38

Caution: If there is an amount on either line 43 or line 44, you must file Form 4720.

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 five columns below. See the instructions for lines 45 through 50 on page 13 of the instructions.)

Lobbying Expenditures During 4-Year Averaging Period N/A Calendar year (or (a) (b) (e) (d) (e) fiscal year beginning in) ► 2007 2006 2005 2004 Total 45 Lobbying nontaxable amount 0. 46 Lobbying ceiling amount 150% of line 45(e )) 0. 47 Total lobbying expenditures 0 48 Grassroots nontaxable amount ...... 0. 49 Grassroots ceiling amount ( 150% of line 48 (e )) ...... 0 50 Grassroots lobbying expenditu res i ran o11-0 LoDDying ActwIy Dy rioneiecting 1-UDllc Gnanties (For reporting only by organizations that did not complete Part VI-A) (See page 14 of the instructions.) During the year, did the organization attempt to Influence national, state or local legislation, including any attempt to Yes No Amount influence public opinion on a legislative matter or referendum, through the use of a Volunteers X b Paid staff or management (Include compensation in expenses reported on lines c through b.) -• ,,, _ _.. X o Media advertisements X d Mailings to members, legislators, or the public ., , X e Publications, or published or broadcast statements X f Grants to other organizations for lobbying purposes X g Direct contact with legislators, their staffs, government officials, or a legislative body - - X h Rallies, demonstrations, seminars, conventions, speeches, lectures, or any other means X I Total lobbying expenditures (Add lines c through h.). • - - 0 If 'Yes' to any of the above, also attach a statement giving a detailed description of the lobbying activities. 723151 12-27-07 Schedule A (Form 990 or 990-EZ) 2007 Schedule A (Form 990 or 990-EZ) 2007 INOVA HEALTH SYST EM FOUNDATI ON 54-1071867 Page 7 Part VII Information Regarding Transfers To and Transactions and Relationships With Noncharitable Exempt Organizations (See page 14 of the instructions.) 51 Did the reporting organization directly or indirectly engage in any of the following with any other organization described in section 501(c) of the Code (other than section 501(c)(3) organizations) or in section 527, relating to political organizations? a Transfers from the reporting organization to a noncharitable exempt organization of Yes No (I) Cash X (ii) Other assets - • alii) X b Other transactions: (I) Sales or exchanges of assets with a nonchardable exempt organization b(i) X (Ii) Purchases of assets from a noncharitable exempt organization ...... b(II) X (iii) Rental of facilities, equipment, or other assets...... b(ill) X (iv) Reimbursement arrangements •- h(iv) X (v) Loans or loan guarantees - - b(v) X (vi) Performance of services or membership or fundraising solicitations ...... • b(VI) X c Sharing of facilities, equipment, mailing lists, other assets, or paid employees i X d If the answer to any of the above is 'Yes,' complete the following schedule. Column (b) should always show the fair market value of the goods, other assets, or services given by the reporting organization. If the organization received less than fair market value in any

52 a Is the organization directly or indirectly affiliated with, or related to, one or more tax-exempt organizations described in section 501(c) of the Code (other than section 501(c)(3)) or in section 527? 1 [::]Yes ®No

12-27-07 Schedule A (Form 990 or 990-EZ) 2007 11 c INOVA HEALTH SYSTEM FOUNDATION EIN 54-1071867 12/3112007 2007 IHSF_990_Cum

Cash Total $567,658.00 $510,000.00 $450,000.00 $265,150.00 $244,250 00 $210,000.00 $170,000.26 $162,000.00 $124,000.00 $118,749 96 $106,500.00 $100,000.00 $100,000.00 $100,000.00 $98,058.75 $95,440 00 $75,000 00 $70,000.00 $70,000.00 $66,800.00 $64,900.00 $63,604.12 $55,531.00 $55,000.00 $54,566.66 $53,275.00 $52,500 00 $50,000.00 $50,000.00 $50,000.00 $50,000.00 $50,000.00 $50,000.00 $44,025.00 $43,700.00 $41,170.00 $37,675.53 $35,980.00 $35,096.25 $35,000.00 $34,900.00 $34,500.00 $33,100.00 $32,530.00 $32,500.00 $31,000.00 $30,301.78 $30,000.00 $30,000.00 $30,000.00 $30,000.00 $27,375 69 $26,629.33 $25,000.00 $25,000.00 $25,000.00 $25,000 00 $25,000.00 $25,000.00 $24,715.60 $23,538.82 $22,770.00 $22,000.00 $21,621.50 $21,400.00 $21,012.00 $20,582.08 $20,476.90 $20,350.00 $20,000.00 $20,000.00 $20,000 00 $19,258.94 $19,100 00 $18,473.50 $18,308.00 $18,300.00 $18,170.00 $18,000.00 $17,500 00 $17,138 10 $17,000.00 $15,700.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000.00 $15,000 00 $15,00000 $15,000.00 $14,925 00 $14,750.00 $14,000.00 $13,780.92 $13,500.00 $13,175 00 $13,000.00 $12,500.00 $12,000.00 $11,850.00 $11,850.00 $11,600.00 $11,500.00 $11,210.00 $11,000 00 $11,000.00 $10,800.00 $10,500.00 $10,500.00 $10,475 00 $10,025.00 $10,000.00 $10,000.00 $10,000.00 $10,000 00 $10,000.00 $10,000 00 $10,000 00 $10,000.00 $10,000.00 $10,000 00 $10,000.00 $10,000.00 $10,000.00 $10,000.00 $10,000 00 $10,000.00 $10,000.00 $10,000.00 $10,000 00 $10,000.00 $10,000 00 $10,000.00 $10,000.00 $10,000.00 $9,900.00 $9,450.00 $9,242.50 $8,965.72 $8,950.00 $8,755 00 $8,347.00 $8,200.00 $8,025.00 $8,000.00 $8,000 00 $8,000.00 $7,900.00 $7,500.00 $7,500.00 $7,500 00 $7,500.00 $7,500.00 $7,500.00 $7,500.00 $7,500.00 $7,500.00 $7,500.00 $7,500.00 $7,478.29 $7,450 00 $7,325.00 $7,325 00 $7,310.00 $7,208 00 $7,100.00 $7,075.01 $7,038 18 $7,000.00 $7,000.00 $7,000.00 $7,000.00 $6,950.00 $6,750.00 $6,500.00 00 000's$ 00.000'x$ 00.000'x$ 00000'9$ 00.000'9$ oo•ooo'cs 00*000's$ 00.000'9$ 00.000'ss 00,000'sS 00.000'x$ 00.000'x$ 00.000'x$ 00 000'9$ 00000,99 00.000'sS 00 000'S$ 00.000'x$ 00.000'9$ 00.000'x$ 00.000'BS 00.000'8$ 00.000'9$ 00 000'9$ 00 000'9$ 00'000'9$ 00000,9S 00.000'x$ 00.000'9$ 00.000'9$ 09190,91 00.4L0's$ 00'00 L's$ 00 OL l's$ 00'0st's$ 00•9te'9$ 00•BZ4's$ 00.009'95 00.009'9$ 00'008'9$ 00.909'9$ 00'009'9$ 00.06L's$ 00'000'9$ 00000'9$ 00000,9S 00 000'9$ 00.000'9$ 00.000'9$ 00'000'9$ 00 000'9$ 00000,9S 00'000'9$ 00'09Z'9$ 00.OSZ'9$ 00.092,9$ 00.09Z'9S 00 09e'9$ 00 08b'9$ 00009V 00 009'9S 00'009'9$ $5,000.00 $5,000.00 $5,000.00 $5,000 00 $5,000.00 $5,000.00 $5,000.00 $5,000.00 $5,000.00 $5,000.00 $5,000 00 $5,000.00 $5,000.00 $5,000.00 $5,000 00 $5,000.00 $5,000.00 $5,000.00 $5,000 00 $5,000.00 $5,000 00 $5,000.00 $5,000.00 $5,000.00

Page 5 9/2212008 Constituent Giving History Page 1

Constituent Name Date Gift Amount Reference

$9,500.00 $2,620.00 $1,290.00 $996.00 $1,990 00 $49800 $1,10000

aL /,Y94.w

$70,000 00 $550,000 00 $386,000.00

$1,006,000 00

$14,675 00 $80.00

$14,755.00

$1,483.00

S15000 $1,846 00 $3,632 00

$5,628 00

$3,000 00

$3,000 00 9/22/2008 Constituent Giving History Page 2

Constituent Name Date Gift Amount Reference

$5,250 00 Lady's Diamond Pendant crafted in 14k whi

$5,250 00

$95000 $300.00 $400.00 $325.00 $1,700 00 $250.00

$3,925 00

$10000

$100.00

$6,475 95

$2,593,550.00 $40,000.00

$2,633,550 00

$7,477 55 $404 00 $1,445 60

$9,327 15 9/2212008 Constituent Giving History Page 3

Constituent Name Date Gift Amount Reference

$20800

$208 00

$29.99

$2999

$2,500 00

$1,500 00

$1,900 00

$5,000 00

$35000 $30000

$65000 9/22/2008 Constituent Giving History Page 4

Constituent Name Date Gift Amount Reference

$5000 $5000

$10000

$37500

$375 00

$14,545 00

$5,000 00

$1,250 00

$1,250.00

$48000 $150.00 $13,723 50

$14,353 50

$245 00

$24500

V 9/22/2008 Constituent Giving History Page 5

Constituent Name Date Gift Amount Reference

$50000

$500.00

$24,500 00

$2,100.00 $3,000.00

$5,100.00

$30000

$7,275.00

$7,275 00

$100.00

$10000

$29,412 00

$29,412 00 9/22/2008 Constituent Giving History Page 6

Constituent Name Date Gift Amount Reference

$33000

$3,000 00

$13,400 00

$13,400.00

$1,858 00 $924 00 $1,840 00 S91800

$5,540.00

$5,000.00 $5,000.00 $1,729 00 $366 00 $2,411 50

$14,506.50

$160.00 $3,000 00 $3,000.00 $400 00

$6,560 00 9/2212008 Constituent Giving History Page 7

Constituent Name Date Gift Amount Reference

$2,065 00 $96 00 $3,580 00 $2,440 00 $2,375 00 $2,500 00 $945 00 $300 00 $500.00

$14,801 00

$62,500.00

$62,500 00

$1 00 $10000 $275.00

$376.00

$17000 $35000 $5,300 00 $190.00

$6,010 00

$3,000.00 $3,000 00

Total Gift In Kind $6,000 00 9/22/2008 Constituent Giving History Page 8

Constituent Name Date Gift Amount Reference

$40,000 00

Grand Total Gift In Kind: $3,995,355.09

4 Inova Hea1tl1 System Foundation EIN 54-1071867 12/31/07

YTD 2007 USE! FUND OF DONATED # FUND NAME FUNDS

Represents Endowed Fund [nova Health System Foundation EIN 54- 1071867, 12/31/07

" Represents Endowed Fund INOVA HEALTH SYSTEM FOUNDATION ATTACHMENT TO 2007 REPORT OF COMMUNITY SERVICES

UNREIMBURSED IHCS AHSC LHI IHSS IHC COST

CHARITY AND INDIGENT CARE 52,057,583 11,152,512 6,978,922 1,695,527 313,783 72.198,327

PARTICIPATION IN GOVERNMENTAL PROGRAMS FOR THOSE WITHOUT THE ABILITY TO PAY

Unreimbursed Cost of Medicaid Patients 35,286,836 5,499,281 1,985,632 2,229,079 78,145 45,058,973

NONBILLED AND BELOW MARGIN PATIENT SERVICES

International Diabetes Center of Virginia 983,656 983,658 HIV Center 586,668 586,868 Kellar Center 1,035,433 1,035,433 CATS Indigent Care 124,187 124,187 Obstetrics and Gynecology Clinic 2,009,256 2,009,258 Pediatric Center 323,502 323,502 Child Life Program 497,651 497,851 Fairfax County Detention Program 254,128 254,128 Loudoun Free Chic 20,881 20,861 Loudoun Mobile Health 178,927 176,927 Facial Rehabilitation Treatment 113,998 113,998 Ophthalmic Specialty Services to the Indigent 322,228 322,228 Bailey's Health Center 2,103,689 2,103,889

COMMUNITY HEALTH EDUCATION AND PROMOTION

Healthsource 1,318,412 1,318,412 Prevention 334,264 334,264 Loudoun Family/Patent Education 15,577 15,577 Loudoun Community Support 102,379 102,379 Cultural Dlversdy 1,587,968 1,587,888 Partnership for Healthier Kids 503.187 503,187

OTHER COMMUNITY SERVICES

Medicaid/SLH Eligibility Assistance 482,901 45,000 527,901

MEDICAL COMMUNITY EDUCATION

Institute for Research and Education Conferences 379,991 379.991 Fairfax Interns and Residents Program 7,534,413 7,534,413 Center for Clinical Education and Development 3,254,822 3,254,822

MEDICAL RESEARCH

Institute of Research and Education 2,536,142 2,536,142

OTHER COMMUNITY BENEFITS 1,202,181 1,202,161

TOTAL UNREIMBURSED COST OF COMMUNITY SERVICES 111,549,767 18,800,482 9,280,298 5,084,226 391,928 145,088,701 INOVA HEALTH SYSTEM FOUNDATION 54-1071867

FORM 990 OTHER INVESTMENT INCOME STATEMENT 1

DESCRIPTION AMOUNT

THE LOOMIS SAYLES SENIOR LOAN FUND LLC 2,094,752. BERNSTEIN INTERNATIONAL VALUE SERIES 7,773,134.

TOTAL TO FORM 990, PART I, LINE 7 9,867,886.

FORM 990 GAIN (LOSS) FROM PUBLICLY TRADED SECURITIES STATEMENT 2

GROSS COST OR EXPENSE NET GAIN DESCRIPTION SALES PRICE OTHER BASIS OF SALE OR (LOSS)

BUILDING FUND 83,077,071. 0. 0. 83,077,071. STATE STREET INVESTMENTS 8,960 ,023. 0. 0. 8,960,023.

TO FORM 990, PART I, LINE 8 92,037,094. 0. 0. 92,037,094.

FORM 990 SPECIAL EVENTS AND ACTIVITIES STATEMENT 3

GROSS CONTRIBUT. GROSS DIRECT NET INCOME DESCRIPTION OF EVENT RECEIPTS INCLUDED REVENUE EXPENSES OR (LOSS)

AUXILIARY SPONSORED EVENTS 165,833. 165,833. 165,833. FOUNDATION EVENTS 2,833,194. 2,833,194. 1500330. 1,332,864.

TO FM 990, PART I, LINE 9 2,999,027. 2,999,027. 1500330. 1,498,697. INOVA HEALTH SYSTEM FOUNDATION 54-1071867

FORM 990 INCOME AND COST OF GOODS SOLD STATEMENT 4 INCLUDED ON PART I, LINE 10

INCOME

1. GROSS RECEIPTS ...... 3,819,564 2. RETURNS AND ALLOWANCES ...... 3. LINE 1 LESS LINE 2 ...... 3,819,564

4. COST OF GOODS SOLD (LINE 13) ...... 1,719,145 5. GROSS PROFIT (LINE 3 LESS LINE 4) . . . . . 2,100,419

COST OF GOODS SOLD

6. INVENTORY AT BEGINNING OF YEAR ...... 7. MERCHANDISE PURCHASED ...... 8. COST OF LABOR ...... 9. MATERIALS AND SUPPLIES ...... 10. OTHER COSTS ...... 1,719,145 11. ADD LINES 6 THROUGH 10 ...... 1,719,145

12. INVENTORY AT END OF YEAR ...... 13. COST OF GOODS SOLD (LINE 11 LESS LINE 12). . 1,719,145

ni nmvkmvm=mlrm / n % A INOVA HEALTH SYSTEM FOUNDATION 54-1071867

FORM 990 OTHER CHANGES IN NET ASSETS OR FUND BALANCES STATEMENT 5

DESCRIPTION AMOUNT

PARTNERSHIP INCOME <9,867,886.> UNREALIZED GAINS 21,623,776. EQUITY EARNINGS IN SUBS 9,332,895. TRANFERS <40,500.>

TOTAL TO FORM 990, PART I, LINE 20 21,048,285.

FORM 990 OTHER EXPENSES STATEMENT 6

(A) (B) (C) (D) PROGRAM MANAGEMENT DESCRIPTION TOTAL SERVICES AND GENERAL FUNDRAISING

UTILITIES 32,007. 31,980. 27. PURCHASED SERVICES 7,475,113. 6,424,646. 1,050,467. TAXES AND FEES 4,269. 4,269. MISCELLANEOUS 640,006. 394,230. 245,776. DUES 28,731. 4,793. 23,938. INSURANCE 28,541. 28,541. BANK FEES 92,042. 63,557. 28,485. BAD DEBT 1,651. 1,651. FREIGHT 3,493. 100. 3,393. TRASH REMOVAL 22,585. 22,585. UNIFORMS 12,970. 12,970.

TOTAL TO FM 990, LN 43 8,341,408. 6,956,512. 1,384,896.

111f amrmW%rvwrrnl o % C C INOVA HEALTH SYSTEM FOUNDATION 54-1071867

FORM 990 CASH GRANTS AND ALLOCATIONS STATEMENT 7 TO OTHERS

CLASS OF ACTIVITY/ DONEE ' S NAME AND ADDRESS AMOUNT

SEE ATTACHED SCHEDULE 11,381,492.

TOTAL INCLUDED ON FORM 990, PART II, LINE 22B 11,381,492.

FORM 990 OTHER INVESTMENTS STATEMENT 8

VALUATION DESCRIPTION METHOD AMOUNT

INVESTMENT IN SUBS COST 48,231,115.

TOTAL TO FORM 990, PART IV, LINE 56, COLUMN B 48,231,115.

FORM 990 OTHER LIABILITIES STATEMENT 9

BEGINNING DESCRIPTION OF YEAR END OF YEAR

INTERCOMPANY 724,188,488. 794,270,589. OTHER LIABILITIES 325,448. 386,499.

TOTAL TO FORM 990, PART IV, LINE 65 724,513,936. 794,657,088.

FORM 990 OTHER REVENUE NOT INCLUDED ON FORM 990 STATEMENT 10

DESCRIPTION AMOUNT

REVENUE OF OTHER ENTITIES REPORTED ON AUDIT 1,973,537,474.

TOTAL TO FORM 990, PART IV-A 1,973,537,474.

- 7 om%ml va%nn / o% •f 0 0 in INOVA HEALTH SYSTEM FOUNDATION 54-1071867

FORM 990 OTHER EXPENSES NOT INCLUDED ON FORM 990 STATEMENT 11

DESCRIPTION AMOUNT

EXPENSES OF OTHER ENTITIES REPORTED ON AUDIT 1,822,163,237.

TOTAL TO FORM 990, PART IV-B 1,822,163,237.

FORM 990 PART V-A - LIST OF CURRENT OFFICERS, DIRECTORS, STATEMENT 12 TRUSTEES AND KEY EMPLOYEES

EMPLOYEE TITLE AND COMPEN- BEN PLAN EXPENSE NAME AND ADDRESS AVRG HRS/WK SATION CONTRIB ACCOUNT

UNCOMPENSATED OFFICERS AND TRUSTEES: 0.00 0. 0. 0.

JOHN TOUPS CHAIRMAN 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

JENNIE L. TRAPASSO SECRETARY 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

NICHOLAS CAROSI TREASURER 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

STEVEN M. CUMBIE VICE CHAIRMAN 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

EDWARD BERSOFF DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

CARL BIGGS DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

JOANNE CRANTZ MD DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

n A c-m%fl1 %IQATRf / O% 11 1 7 INOVA HEALTH SYSTEM FOUNDATION 54-1071867

LORI MORRIS DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

CLEVELAND FRANCIS MD DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

MICHAEL HARDY MD DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

MICHAEL KELLY DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

MARK LOWERS DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

CHARLES SMITH, III DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

SHAWN MCLAUGHLIN DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

ALAN MERTEN PHD DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

FREDERICK SACHS DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

MARK STAVISH DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

WINSTON UENO MD DIRECTOR 8110 GATEHOUSE ROAD, SUITE 200 10.00 0. 0. 0. FALLS CHURCH, VA 22042

LYDIA THOMAS PHD 8110 GATEHOUSE ROAD, SUITE 200 0.00 0. 0. 0. FALLS CHURCH, VA 22042

TOTALS INCLUDED ON FORM 990, PART V-A 0. 0. 0.

11 c 'mrmL+w'ktmia% I ') INOVA HEALTH SYSTEM FOUNDATION 54-1071867

FORM 990 IDENTIFICATION OF RELATED ORGANIZATIONS STATEMENT 13 PART VI, LINE 80B

NAME OF ORGANIZATION EXEMPT NONEXEMPT

INOVA HEALTH SYSTEM SERVICES X INOVA HEALTH CARE SERVICES X IMANCO, INC. X INOVA VNA HOME CARE, INC. X INOVA PHYSICAL REHABILITATION SERVICES X INOVA ALEXANDRIA HOSPITAL X INOVA MEDICAL FOUNDATION X UMC HOLDINGS, INC. X INOVA EMPLOYEE ASSISTANCE X ALEXANDRIA HEALTH SERVICES CORPORATION X LOUDOUN SERVICES GROUP X INOVA HOLDINGS, INC. X ALEXANDRIA COMMUNITY HEALTHCARE GROUP X ALEXANDRIA HOSPITAL FOUNDATION X ALEXANDRIA MEDICAL PROPERTIES X LOUDOUN HOSPITAL CENTER X LOUDOUN NURSING AND REHABILITATION CENTER X LOUDOUN HEALTH SERVICES X LOUDOUN HEALTHCARE FOUNDATION X INTERGRATED PHYSICIAN SERVICES X

')C [ImwmWD 7vnl % 112 INOVA HEALTH SYSTEM FOUNDATION 54-1071867

FORM 990 PART IX - INFORMATION REGARDING TAXABLE STATEMENT 14 SUBSIDIARIES AND DISREGARDED ENTITIES

NAME OF CORPORATION, PARTNERSHIP OR DISREGARDED ENTITY

INOVA HOLDINGS, INC.

ADDRESS

2990 TELESTAR COURT, FALLS CHURCH, VA 22042

EMPLOYER PERCENT TOTAL END-OF-YEAR ID NUMBER OWNED NATURE OF ACTIVITIES INCOME ASSETS

51-0332880 100.00% INVESTMENTS 1,311,935. 15 ,954,436.

NAME OF CORPORATION, PARTNERSHIP OR DISREGARDED ENTITY

INTERGRATED PHYSICIAN SERVICES

ADDRESS

2990 TELESTAR COURT, FALLS CHURCH, VA 22042

EMPLOYER PERCENT TOTAL END-OF-YEAR ID NUMBER OWNED NATURE OF ACTIVITIES INCOME ASSETS

54-1734471 100.00% HEALTHCARE SERVICES 0. 0.

1)17 Orn mvszcl%Tm / O % IA INOVA HEALTH SYSTEM FOUNDATION 54-1071867

FORM 990 DESCRIPTION OF TRANSFER STATEMENT 15 PART XI, LINE 106

NAME OF CONTROLLED ENTITY EMPLOYER ID

INOVA HEALTH CARE SERVICES 54-0620889

DESCRIPTION OF TRANSFER

INTERCOMPANY SWEEP ACCOUNT FOR CASH

NAME OF CONTROLLED ENTITY EMPLOYER ID

ALEXANDRIA HEALTH SERVICES CORPORATION 52-1356573

DESCRIPTION OF TRANSFER

INTERCOMPANY SWEEP ACCOUNT FOR CASH

NAME OF CONTROLLED ENTITY EMPLOYER ID

INOVA HOLDINGS, INC 51-0332880

DESCRIPTION OF TRANSFER

INTERCOMPANY SWEEP ACCOUNT FOR CASH

'q 0 OTw TQw17rt+ / O \ 1 G INOVA HEALTH SYSTEM FOUNDATION 54-1071867

FORM 990 DESCRIPTION OF TRANSFER STATEMENT 16 PART XI, LINE 107

NAME OF CONTROLLED ENTITY EMPLOYER ID

LOUDOUN HEALTHCARE, INC. 54-1361309

DESCRIPTION OF TRANSFER

INTERCOMPANY SWEEP ACCOUNT FOR CASH

NAME OF CONTROLLED ENTITY EMPLOYER ID

INOVA HEALTH SYSTEM SERVICES 54-1434144

DESCRIPTION OF TRANSFER

INTERCOMPANY SWEEP ACCOUNT FOR CASH

7o L-MArrWW=M'Rn/n% 1C INOVA HEALTH SYSTEM FOUNDATION 54-1071867

SCHEDULE A EXPLANATION OF TRANSACTIONS STATEMENT 17 PART III, LINE 2D

SEE ATTACHED SCHEDULE OF TRUSTEE TRANSACTIONS

11 n c.mwmt'tj ' rm/c' 17 INOVA HEALTH SYSTEM FOUNDATION

TAX ID #: 54-1071867

THE ATTACHED "REPORT OF PROGRAM AND COMMUNITY SERVICES" IS SUBMITTED TO MEET THE REQUIREMENT OF IRS FORM 990, PART III - STATEMENT OF PROGRAM SERVICE ACCOMPLISHMENTS, FOR THE YEAR ENDED DECEMBER 31, 2007. INOVA HEALTH SYSTEM FOUNDATION REPORT OF PROGRAM AND COMMUNITY SERVICES FOR THE YEAR ENDED DECEMBER 31, 2007

Inova Health System Foundation, the parent company ofInova Health System, is a nonstock, not-for- profit corporation exempt from federal income taxes under the provisions ofSection 501(c)(3) ofthe Internal Revenue Code. Inova Health System (Inova) provides healthcare and related services throughout northern Virginia and the greater metropolitan Washington, D.C. area, including certain contiguous counties of Virginia and Maryland.

Inova is comprised of 1) Inova Health Care Services, a not-for-profit corporation which operates hospital facilities, programs, and other shared service arrangements and carries on education and research activities; 2) Alexandria Health Services Corporation, a not-for-profit organized to promote the health and well-being ofthe Alexandria community; 3) Loudoun Healthcare, Inc., a not-for-profit organized to promote the health and well-being ofthe Loudoun community; 4) Inova Health System Services, a not-for-profit corporation which provides non-hospital clinical services; 5) Imanco, Inc., a not-for-profit management services company; 6) Inova Holdings, Inc., the parent holding company for the taxable healthcare entities within Inova; 7) Inova Health System Foundation (Foundation), a parent company which also serves as a charitable foundation, raising funds to support Inova's tax- exempt entities; and 8) Inova Medical Foundation, a not-for-profit organized to create and manage a primary care physician network.

Separate 2007 tax returns were filed for each of Inova's incorporated entities listed above. The tax return of Inova reflects the revenues and expenses generated by the fund-raising and distribution activities of the Foundation.

PROGRAM SERVICES

It is the primary mission of the Inova Health System to serve the community as a not-for profit organization through the provision of a full spectrum of high quality and accessible healthcare services, including maintenance and restorative services. Inova provides comprehensive community- based healthcare services through owned organizations and partnerships with other healthcare providers, including physicians, hospitals, and insurers. Inova also provides clinical training for medical resident and other students, provides education to healthcare professionals, engages in clinical research activities, and provides many other services to the community. The services provided by each of Inova's subsidiaries and its charitable foundation are described more fully below.

Inova Health Care Services

As of December 31, 2007, IHCS operated three hospitals, having a total of 1,247 licensed hospital beds in Fairfax County, Virginia -- Fairfax Hospital (Fairfax), Mount Vernon Hospital (Mount Vernon), and Fair Oaks Hospital (Fair Oaks). Each of these hospitals provide general acute care services, including emergency room facilities, inpatient and outpatient services, and a varying number of ancillary and specialized services based on the needs of the community.

IHCS is also the parent company oftwo free-standing 24-hour emergency centers, which are affiliated with its hospitals, and operates The Institute of Research and Education, which provides a quality arena for professional education and clinical research. In addition, IHCS operates several subsidiaries. American Medical Collection Bureau, Inc. is a not-for-profit corporation providing collections services to Inova's hospitals and affiliates. INOVA HEALTH SYSTEM FOUNDATION Page 2 2607 REPORT OF PROGRAM AND COMMUNITY SERVICES

Alexandria Health Services Corporation (AHSC) provides services to the Alexandria community through the coordination and operation of a hospital and other related health care entities. Facilities operated by AHSC include: The Inova Alexandria Hospital; the Inova Alexandria Foundation; and other affiliates and subsidiaries providing clinical services and support of the delivery of integrated health care services to the Alexandria community.

Loudoun Health Services, Inc (LHI) is a tax-exempt, non-stock corporation that serves the health care needs of Loudoun County, Virginia, and surrounding areas. LHI operates Loudoun Hospital Center, Loudoun Nursing and Rehabilitation Center, Loudoun Healthcare Foundation and other health care and related facilities.

Inova Health System Services (IHSS) and its subsidiaries provide home healthcare, long-term care, and behavioral health services. Home healthcare services are provided throughout northern Virginia and the metropolitan Washington, D.C., area by Inova Home Care, Inc., and Inova Health Professionals, Inc. Long-term care is provided by IHSS's two nursing homes, Commonwealth Care Center and Cameron Glen Care Center, which provide a total of366 licensed nursing home beds, and through Elderlink, a cooperative program providing case management to older adults and Inova Assisted Living, a transitional living facilities. In addition, Comprehensive Addiction Treatment Services provides services to adults suffering from alcohol and other chemical dependencies, and The Kellar Center provides treatment for children and adolescents with substance abuse and behavioral and emotional problems.

Imanco. Inc., provides executive management, consulting, and employee leasing services to Inova and its principal affiliates.

Inova Holdings, Inc., and its taxable subsidiaries provide a variety ofoutpatient healthcare services, which include: six emergency care centers, genetic counseling and in-vitro fertilization, biomedical equipment maintenance, weight reduction consultation, and others.

The Foundation operates in accordance with Inova's Articles ofIncorporation which provide that all funds raised, except for those required for the operations ofthe Foundation, be distributed or held in support of, the charitable objectives and mission of Inova and its tax-exempt subsidiaries. Funds raised are channeled to the community in the form of expanded medical and other community services. During 2007, Foundation funds were used to support Fairfax's women's and children's services and its neonatology program, the Life with Cancer support and educational program, the Child Abuse Center, and many other programs and services. In addition, donated funds were used in 2007 to support many other Inova programs, including Mount Vernon's Inova Center for Rehabilitation and The Kellar Center's Behavioral Services Program

Inova Medical Foundation is organized to coordinate the delivery of a full spectrum of hospital, emergent, health and preventative services by professional and institutional providers under various managed care contractual arrangements, including capitation and at-risk contracts. 1NOVA HEALTH SYSTEM FOUNDATION Page 3 2007 REPORT OF PROGRAM AND COMMUNITY SERVICES

COMMUNITY SERVICES

Since its initiation by citizen-volunteers in 1956, Inova and its related companies have grown to meet the changing needs ofa diverse and growing population. As a not-for-profit organization, Inova does not have shareholders. It is governed by the people it serves: members ofthe community. This "local" Board of Trustees helps to ensure that surplus resources are used to subsidize the kind ofprograms and services that most benefit community health.

In keeping with the Inova's community service mission, Inova and its subsidiaries provide a wide range of programs and services which directly benefit the community they serve. These include: o Providing the highest quality medical care to all members of the community, regardless of their financial resources. o Providing nonbilled and below margin health services to meet the identified needs oftargeted community groups, such as: the indigent and elderly; victims of cancer, heart disease, and stroke; persons affected by substance abuse; HIV-positive individuals; and others. o Providing health education and a variety of other services to the community. o Educating the medical community and participating in medical research activities.

The many types ofcommunity services provided by Inova and its subsidiaries are described more fully below, and the estimated unreimbursed cost of providing these services are summarized in the attachment to this report.

Charity Care

Charity care is defined as free or discounted healthcare services provided to persons who cannot afford to pay. Each facility provides charity care in accordance with policies which ensure access to medically necessary care for all individuals. In 2007, the unreimbursed cost ofcharity care, including free and discounted services, provided by Inova subsidiaries covered by this report was $72,198,327. This amount does not include the cost of care provided to the medically indigent through participation in governmental programs, which is described below.

Participation in Governmental Programs for Those Without the Ability to Pay

Various government programs provide for the indigent, including Medicaid and Virginia State and Local Hospitalization (SLH). These programs provide some reimbursement for qualifying patients; however, payment is typically below the cost of those services. In addition to federal and state programs, Inova and its subsidiaries work with various County governments and agencies and provide free and discounted services to certain residents that the County identifies as most in need. During 2007, Inova's unreimbursed cost of participation in governmental programs for those without the ability to pay was $45,058,973. INOVA HEALTH SYSTEM FOUNDATION Page 4 2007 REPORT OF PROGRAM AND COMMUNITY SERVICES

Nonbilled and Below Margin Patient Services

Each year, Inova designates funds for the development and continuation of carefully identified programs and services that directly benefit, and provide access to, healthcare and related services to those most in need in the community. Many of these programs and services are not billed to the patient or are provided for fees which are below the actual cost of providing the service. o Fairfax's Obstetrics and Gynecology Clinic provided comprehensive obstetric and gynecology services to women of limited income in Fairfax County; 52,655 patient visits were provided in 2007 at an unreimbursed cost of $2,009,256. o Other specialty programs and services are provided by Inova subsidiaries to meet specific community needs. These services include the Inova Pediatric Center, case management services for HIV patients, a complete range of support services to cancer patients and their families, an Ophthalmology Clinic, the International Diabetes Center of Virginia, and many others. o In addition, a variety of crisis intervention and other support services are provided to Inova patients. These include intervention with public agencies in situations of domestic violence and child abuse, guidance and referral services, assistance in obtaining Medicaid/SLH eligibility, and many others.

Community Health Education and Promotion

Inova's mission includes a commitment to foster a healthier community. As part of its health promotion effort, Inova subsidiaries are actively involved in sponsoring programs, activities, and services designed to improve community health and prevent the onset of disease. Health classes, support groups, and other information are provided on an ongoing basis for a wide variety ofhealth concerns. Inova also provides a speakers bureau and tour programs to benefit community groups and schools, and a variety of health screenings are offered in Inova facilities and at local health fairs and other community events. In addition, health newsletters, including Fairfax's "Regarding Women," were distributed to over 500,000 community residents several times during 2007.

Other Community Services

Inova and its subsidiaries go beyond their role as providers ofhealthcare services, community health education, and medical education and research, to provide other community services as well. On an ongoing basis, Inova contributes its facilities and resources to benefit the community it serves. o Inova Medical AirCare is a unique 24-hour medically-equipped helicopter transport unit which generally operates within a 150-mile radius ofFairfax Hospital, serving IHCS hospitals and other hospitals in the surrounding area. The service is used primarily for transporting critical patients between hospitals to obtain more advanced medical treatment. INOVA HEALTH SYSTEM FOUNDATION Page 5 2007 REPORT OF PROGRAM AND COMMUNITY SERVICES

o Inova subsidiaries provided many other community services in 2007 including: participation in the local Meals on Wheels program, providing over 120,000 meals to community residents; working with a local community service group to provide milk to the homeless and indigent; providing over 70,000 pounds of laundry and linen to area homeless shelters; sponsoring an employee volunteer program; providing meeting space and services to many community groups; and many others.

Medical Community Education

Towards the goal ofimproving patient care, Inova subsidiaries provide a variety ofinnovative medical education and training programs for medical residents, physicians, and other healthcare professionals. o Fairfax' s medical education programs include a medical residency program, a graduate- level nursing education program, and a paramedical educational program Fairfax's residency program has approximately 300 residents (medical student graduates) at any one time and an average of 350 students are trained each year. During 2007, Fairfax's unreimbursed cost was $7,534,413 for its educational programs. o The Institute of Research and Education was established in 1991 for the purpose of expanding research and educational activities through Inova. The Institute provides conference management services related to the production ofaccredited education symposia and other events to help physicians and other healthcare professionals keep pace with developments in medicine and technology. More than 50 educational activities are provided each year covering a variety of medical specialty areas. o Inova subsidiaries provide a variety of other medical education programs for healthcare professionals. In 2007, Mount Vernon provided clinical internships for 3 students in various rehabilitation disciplines; Fair Oaks provided clinical training for 8 laboratory technicians and phlebotomy students; Fairfax provided field experience to local students in lab services and in paramedical work; the HIV Resource and Conference Center at Fairfax provided training to healthcare professionals to care for HIV-infected patients; Commonwealth Care Center provided nursing home training; and Inova Home Care provided home health training.

Medical Research

The Research Services division of IHCS's Institute of Research and Education provides a variety of essential services to support health-related scientific research. Through the Institute, physicians and other Inova health professionals participate in clinical investigations that may lead to advances in medical treatment and patient care. The Institute provides technical and administrative support in the design, conduct, and administration of clinical investigational studies, and in contract management. During 2007, the Institute conducted over 200 clinical trials.

IHSFCMSV.07 INOVA HEAL I H Inova Health System SYSTEM 2007 Transactions with Trustees or Related Companies March 6, 2008 Board / Committee Board Member Related Payee Description od Services 2007 Amount Fees paid to George Mason University for nursing scholarships and for nursing program classes provided $ 235,120.11 on site at move facilities. IHS Alan G. Marten, Ph.D. - President George Mason University Fees paid to GMU for providing services as a sub- $ 107 , 531.92 contractor workin on Inova research rants. Fees paid to participate In George Mason University $ 8 , 324.00 lob fairs and miscellaneous activities. IHS, IHCS Purchases of water treatment chemicals provided to Carl Biggs - President C & E Services $ 107 , 867.39 Finance Committee Inova Hospitals. Investment Committee Fees paid for services as medical director of geriatric services for Inova Fairfax Hospital. The contract IHS Joanne Crantz, MD Joanne Crantz, MD $ 9 ,230. 76 began September 2007. Payments cover September throw h November 2007. Inova 12 month Subscription Fee for a system to track IHS product recalls. The system allows (nova to track and $ 27,379.25 Finance Committee Lydia Thomas, PhD Noblis trend recalls throw hout all the facilities. Sub Former President & CEO Audit and Compliance Consulting services provided to Life with Cancer to Committee 5,450.00 assist with obtaining a rant. $ IHS Precision Door was paid directly for services by Inova Foundation IHS and was paid indirectly as a subcontractor of Scott Finance Committee Frederick W. Sachs , Jr. Precision Doors & Hardware Long Construction and as a subcontractor of Dominion $ 151,389.52 Compliance Sub President & CEO Audit and Construction for supplies and projects at Inova Committee facilities. investment Contract fees paid for EKG physician Interpretation Cleveland Francis, Jr., MD $ 10 , 165.00 services at move Mount Vernon Hospital IHS Fees paid for providing services to Inova Learning Cleveland Francis, Jr., MD Cleveland Francis, Jr., MD $ 1 , 000.00 IHCS Institute at management meetin s. Contract fees to serve as the Inova Health System Cleveland Francis, Jr., MD $ 73 ,500.00 Medical Affairs Council Chairman IHCS Charles Mann - Partner Contract fees paid for credit card system transaction ILH Board Alliant Merchant Services 10 , 355. 98 J Arthur Monk - Partner processing at Inova Hospitals. $ Loudoun Foundation

1 of 3 INOVA HEAL [H Inova Health System SYSTEM 2007 Transactions with Trustees or Related Companies March 6, 2008

Board / Committee Board Member Related Payee Description od Services 2007 Amount

Contract fees to Dr DiLorenzo to serve as the Inova Paul DiLorenzo, MD Fairfax Hospital I IFH for Children Medical Staff $ 125,000.04 President. The entire amount Is paid by the Hospital. Fees paid to Dr. DiLorenzo as principle investigator in Paul DiLorenzo, MD an approved research trial through Inova Research $ 128.75 IHCS Paul Dil-orenzo, MD Center Fees paid to the physician practice for clinical services including trans-esophageal echo on-call services, EKG reader fees, global cardiac billing arrangements, Move Fairfax Heart Associates, PC Alexandria indigent patient services, resident and $ 146,902.74 Intern Instruction In the CCU, global transplant billing arrangements, and services to Northern Virginia Mental Health r patients. IHCS Contract fees to serve as the Inova Mount Vernon All Ganjei, MD All Ganjei, MD Hospital Medical Staff IHS Foundation President. The Medical Staff $ 81,999.96 pays $22 ,000 of this annual amount. Contract fees to serve as the Inova Alexandria Hospital Medical Staff President The Hospital pays $67,500 of IHCS George Tawil, MD George Tawil, MD 120, 000. 00 this annual amount and the Medical Staff pays the $ balance. Contract fees to serve as the Inova Fair Oaks Hospital IHCS Carey Marder, MD The Cardiovascular group, PC Medical Staff President. Half of this annual amount $ 115,000.00 aid by the Medical Staff. Contract fees to serve as the Inova Loudoun Hospital IHCS Medical Staff President. This Includes payment for Kevin O'Connor, MD Kevin O'Connor, MD $ 88 ILH Board December 2008. The annual amount Is $80,000. This , 679. 71 entire annual amount Is paid by the Hospital. Fees paid to serve as (nova Loudoun Hospital Medical ILH Board Christopher Chlantella, MD Christopher Chlantella, MD Staff President Elect for the period March through $ 10,000.00 December 2007. Fees paid to physician group for a variety of clinical and management services Including management of Inova's MRI, PET scan, and tomotherapy services, ILH Board Allen Joseph, MD Fairfax Radiological Consultants $ 7, 375, 238 92 services to mental health patients, resident teaching . services, and services provided to Inove's executive health center. Fees paid for consulting services IHS Foundation Richard Binder, MD, FACP Richard Binder, MD, FACP related to (nova's $ fundraisin for research and education. 101,521.14 Fees paid to cardiologists IHS Foundation Patrick Bowen, MD Patrick Bowen, MD who teach residents and interns in the Inova Fairfax CCU. $ 2, 812 . 50

2 of 3 INOVA HEAL iII Inova Health System SYSTEM 2007 Transactions with Trustees or Related Companies .t 1 March 6, 2008

Board / Committee Board Member Related Payee Description od Services 2007 Amount

Executive management and team development and IHS Foundation Jo Moyer - Vice President Lee Hecht Harrison coaching services provided to several facilities and $ 49,700.00 departments. Fees paid to the physician practice for conducting $ 1 , 770. 00 Inove employee pre-employment physicals Fees paid to the physician practice for clinical services provided In the emergency department. These Include services provided under global cardiac billing arrangements, Inova employee workers compensation $ 24,022.91 services and services to Northern Virginia Mental Health Center patients required by an agreement between (nova Fairfax and the Mental Health Center.

Fees IHS Foundation Thom A. Mayer, MD - President & CE Best Practices paid to provide occupational medicine services $ under contract at the Inova Emergency Care Centers. 157 , 207. 72

Fees paid for medical director services Including (nova emergency care centers, Inova Fairfax ED, and $ 177,733.40 emergency management and disaster medicine.

Payments made to the emergency physician group for providing the emergency services residency director, oversight of the pediatric emergency medicine $ 141,150.00 fellowship, and for training medical residents that rotate through the emergency department. Purchases of fuel for Inove vehicles at various move IHS Foundation Denny M. Houston - Executive VP Exxon Mobile locations. The departments include materials $ 39,241.17 mans ement and facilities engineering. Web Hosting Services and support provided to Inova IHS Foundation Earl W. Stafford - Chairman & CEO Universal Systems & Technology Fairfax trauma services for the Northern Virginia Injury $ 2,800.00 Prevention Center web site. Dewberry and Davis was paid directly by Inova and IHS Foundation Sid Dewberry - Chairman Dewberry and Davis Indirectly as a subcontractor of Turner Construction for $ 433,003.37 projects at Inova facilities. Fees paid to provide IAH Foundation Stephen Banks, MD Stephen Banks, MD services as Inova Alexandria $ Cancer Center Medical Director. 5 , 000. 04 Contract fees paid for EKG physician Interpretation Loudoun Foundation John H. Cook, MD John H. Cook, MD $ 8 , 000.00 services at Inoue Loudoun Hospital Fees paid to Merrill Lynch to act as the remarketing Loudoun Foundation John W. Sheehan - Vice President Merrill Lynch agent and broker dealer for Inova's variable rate tax $ 242,127.99 exempt bonds.

3of3 INOVA HEALTH SYSTEM FOUNDATION E.I.# 54-1071867

STATEMENTS ATTACHED TO AND MADE A PART OF FEDERAL EXEMPT ORGANIZATION INCOME TAX RETURN FOR THE YEAR ENDED DECEMBER 31, 2007

FORM 990, PART II, LINE 42

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

DEPRECIATION EXPENSE LINE 42 29,820

FORM 990, PART IV, LINE 57

12/31/2007

LAND AND LAND IMPROVEMENTS $ 2,275,486

BUILDINGS AND FIXED EQUIPMENT 263,378

LESS ACCUMULATED DEPRECIATION ( 186,389)

TOTAL $ 2,352,475

Page 1 INOVA HEALTH SYSTEM FOUNDATION Compensated Officers EMPLOYER ID# 54-1071867 ATTACHMENT TO IRS FORM 990; PART V LIST OF OFFICERS , DIRECTORS , TRUSTEES , AND KEY EMPLOYEES FOR THE YEAR ENDED 12/31 /07

-COMPENSATION FROM IMANCO, INC, A RELATED ORGANIZATION - -COMPENSATION FROM INOVA HEALTH Sl' STEM FOUNDATION- ID# 54-1340725 (A) (B) (C) (D) (E) (C) (D) (E) CONTRIBUTIONS EXPENSE ACCOUNT CONTRIBUTIONS EXPENSE ACCOUNT TITLE AND TO EMPLOYEE AND OTHER TO EMPLOYEE AND OTHER NAME AND ADDRESS AVERAGE HRS /WK COMPENSATION BENEFIT PLANS ALLOWANCES COMPENSATION BENEFIT PLANS ALLOWANCES

J Knox Singleton President and Chief Executive Officer 1,264 , 511 27 , 763 54,902 0 0 0 2990 Telestar Court 50 Fells Church , Virginia 22042

Rodney N Huebbers Execu tive Vice President, Eastern Region 936,651 98,929 33,699 0 0 0 2990 Telestar Court 50 Falls Church , Virginia 22042

Mark S Stauder Chief Operating Officer 715,614 27,763 32,622 0 0 0 2990 Telestar Court 50 Falls Church , Virginia 22042

Richard C Magenheimer Chief Financial Officer 664,125 48,066 93,992 0 0 0 2990 Telester Court 50 Fells Church , Virginia 22042

James C Hughes Chief Corporate Services Officer 668,089 21 , 288 37,524 0 0 0 2990 Telestar Court 50 Falls Church , Virginia 22042

Douglas P Cropper Executive Vice President , Inova Fairfax 540,148 105, 191 32,578 0 0 0 2990 Telestar Court Hospital and (nova Hospital For Children Falls Church , Virginia 22042 50

H Petndc Walters Executive Vice President 602 , 332 24, 614 34,902 0 0 0 2990 Telester Court 50 Falls Church , Virginia 22042

Kylanne Sliverstone Chief Admmistratve Officer 481,716 75,326 35,013 0 0 0 2990 Telestar Court 50 Fells Church , Virginia 22042

Shannon Sinclair Assistant Secretary, Senior Vice President 476,851 45, 171 20,917 0 0 0 2990 Teiestar Court and General Counsel Falls Church , Virginia 22042 50

John Fey Vice President , Foundation 332,533 45, 459 30,400 0 0 0 2990 Telestar Court 50 Falls Church, Virginia 22042

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