1. Network Update January 29, 2015 Network Update January 29, 2015

2. Objectives 1.Overview of our approach to ACOs 2.Discuss progress to date 3.Outline goals for 2015 2

3. Dynamics of Accountable Care Defined population Provider collaboration Better outcomes More affordable 3

4. Business as Usual? How we know who our Population is Priority metrics Performance and Real-time reporting 4

5. Not Another HMO… 5 New and Improved? Who decides? Care coordination & patient activation Shared financial risk and reward Balanced scorecard: quality & cost Data driven quality measurement

6. Key Comparisons Patient Flexibility Utilization Review Network TypeFocus PPO  XBroad  Patient choice HMO  XNarrow  Prescribed rules - gatekeeper  Preventive Services  Utilization and Cost Reduction ACO  c/t HMO  c/t PPO X In Between/ Narrow  Physician-driven collaboration  Balance of Quality and Cost imperatives 6

7. National Trends 600 18.2M 7

9. Progress and Vision for 2015 CIN Network Development Clinical Collaboratives Care Management IT/ Analytics Contracting Communications 9

10. Clinically Integrated Network Goal Progress – Independent provider contracts – Board review of credentials – Preparing for board applications 2015 Plan – Ongoing CIN development – Fully appointed board – Committee activity 10

11. Clinical Collaboratives 11 Pediatrics Obesity Appendectomy Medicine COPD Pneumonia Critical Care Sepsis Respiratory Failure Surgery Total Joint Colon Surgery Women’s Health OB GYN (e.g. hysterectomy) Cardiovascular CHF AMI Atrial Fibrillation Kate.Mundell@multicare.org

12. Care Management & Population Health Goal – Infrastructure to support population health Progress – Staffing model implementation 2015 Plan – Physician Executive of Care Management – Care management analytical reporting 12

13. IT and Analytics Goals – Health Information Exchange – Analytic platforms Progress – HIE/Analytics contracts completed – Implementation 2015 Plan – Completed analytics implementation – Use of analytical capability with reports to CIN providers – Rolling HIE interfaces – Disease registries 13

14. Finance and Contracting Goal – Grow covered lives Progress – Boeing-UW ACN agreement – MCC contract migration – Health Care Authority application 2015 Plan – Contract prioritization and migration – Establish information sharing process for CIN participants for new contracts 14

15. Marketing and Communications Goal – Grow understanding – Facilitate transparency and accelerated performance Progress – New website www.MultiCareConnectedCare.com – Educational events 2015 – Update communication plan – Future forums/updates – Communication network for rapid information sharing 15

16. What does this mean for you? Part of a strong team empowered to focus on: – Increasing quality of care – Enhancing patient experience – Managing cost of care 16

18. APPENDIX 18

19. Attribution Based on prior patient activity, an enrollee is attributed to a particular provider based on this prior activity. Can provide general estimates of the scale of the anticipated population. 19

20. Designation Enrollees may not have a record of prior activity (i.e. do not meet attribution criteria) and therefore self-select or designate their provider 20

21. Assignment Enrollee is provided a list of participating providers and chooses a primary care provider. If the enrollee does not access primary care with their selected primary care provider, the enrollee may be reassigned to the primary care provider where care is delivered. 21

22. PPO Preferred Provider Organization or Participating Provider Organization. The network is generally broad and includes many/most providers in the service area. Provider & Payor agree to discounted fee schedules. Utilization Management is key in this model. Enrollees (or members) typically pay a higher premium compared to HMO’s to have access to greater choice and self-referral. Generally there’s a modest differential between in-network and out-of-network benefits. Open Access/Point of Service- there is generally no gatekeeper requirement and these activities are covered under more traditional plan terms (e.g. typically, the co-pay/co-insurance out- of-pocket for the beneficiary will be greater for specialty services. 22

23. HMO Health Maintenance Organization Largely created in response to the need to incent preventative services (e.g. immunizations, mammograms, well-child check-up’s, routine physicals). Network is narrow and generally built around one provider system, if feasible. Patient selects a PCP who acts as a “gatekeeper”, i.e. referrals are required prior to seeing specialists (except in emergency situations). Utilization Management is key, supplemented by ambulatory programs such as chronic condition management. Patients may still use providers outside of the HMO network but there is no benefit coverage except for pre-approved or emergency situations. 23

24. ACO Physicians play a much greater role in defining best-practices, with specific outcomes- oriented quality performance measures. Care coordination in partnership with patients across the continuum of health care services is key. (Patient activation and engagement are an important factor) Aligns with population health focusing on LIVES not just those who are engaged with a care provider (Patients) Reimbursement is not purely fee-for-service but rather offers incentive to manage medical costs and achieve quality improvement goals, and generally penalties for negative variance on medical costs vs. target. i.e. value-based reimbursement. The network is generally exclusive to a particular clinically integrated network or integrated health system. Benefits are designed to support health improvement goals of the program with zero/low copay for preventive health and primary care services. Data transparency is key. Utilization management is critical 24