2. Castlight Update George Lenko Program Director – National Initiatives
Anthem BCBS
Nita Sommers
VP Business Development
Castlight Health
This session is billed as an update, but I’m pleased to say that this is more of an announcement.
Over the past year, working together on 3rd Party Transparency, Anthem and Castlight have grown to understand each others’ strengths and, today, Anthem is announcing our partnership with Castlight to deliver an advanced benefit design, specifically Reference Based Benefits.
(introduce Nita)
Anthem believes that, by linking our Blue network advantage to state-of-art information technology, we can preserve enrollee choice & access while saving benefit costs through reference based benefit (RBB) designs.

3. Anthem’s Hip/Knee RBB Results
Anthem analysis of the RBB pilot revealed:
The number of surgeries performed at facilities that charge below the benefit threshold was 8% higher once the program was in place.
$35,000.00
$30,000.00
$25,000.00
$20,000.00
$15,000.00
$10,000.00
$5,000.00
$0.00
Average cost per surgery
Pilot Period
Benchmark Period
The average paid amount per surgery was 30% lower during the pilot than it was the prior year. This is a combination of the members going to lower cost facilities more often, as well as the cap being applied to members who chose to use facilities that charged in excess of the threshold. 8%
higher
REFERENCE BASED BENEFITS: Having transparency information enables us to develop advanced benefit models. We’ve had great success with our pioneering work on Reference Based Benefits….For CalPERS, we saw an 8% redirection to lower cost sites for knee & hip replacements and, better still a 30% drop in cost per service compared to the prior year.
Our message to the market has been….
Pilots have demonstrated success
Program is available nationally, based on national Blue transparency data
Plans in the works to enhance considerably for Jan 2014
30%
lower

4. Why RBB?
Anthem found tangible advantages from our transparency efforts. Unfortunately, most enrollees don’t access the information.
Coupling transparency information to benefit design heightens the shopping experience
RBB has advantages over restrictive benefit design; it applies only to services where shopping is possible and it preserves choice…we can leverage our broad networks .
For 2014, Anthem is ‘doubling-down’ on RBB.
Anthem has found tangible advantages from our Consumer Engagement and transparency efforts. Beyond helping patients choose better care, our efforts to expose differences in cost, quality, and patient experience have changed competitive dynamics among health care providers. Furthermore, enrollees using our information have been increasingly satisfied by finding useful information for many conditions.
Unfortunately, most enrollees don’t access the transparency information. Or, even when presented with cost & quality differences, they haven’t considered seeking care from alternate sites….especially where there is negligible out-of-pocket advantage in doing so.
To encourage engagement and to make the choices more meaningful, Anthem has found that coupling the transparency content to benefit design heightens the shopping experience.
“Reference Based Benefits” is an advanced plan design which sets benefit limits on certain commonly available services with highly variable costs. The limits are set based on the distribution of providers’ contracted rates, and they’re sensitive to the employer’s quality and access objectives. Patients who seek care from providers costing more than the reference threshold are responsible for the excess costs.
RBB has advantages over restrictive network designs because it applies only to services where shopping is possible, and since enrollees can continue to use the broad network for impacted services and, of course, for all other medical services.

5. Why partner with Castlight?
A market-leading RBB capability requires high enrollee engagement, state-of-art navigation, and ability to adjudicate advanced benefit designs
Castlight did pioneering work in RBB, focusing especially on engagement & navigation. They are regarded by many as the market leader in the medical shopping experience.
By integrating Castlight’s capabilities and Anthem’s networks & servicing, we can offer a market-leading RBB plan design. .
A market-leading RBB capability requires high enrollee engagement, state-of-art navigation, and ability to adjudicate advanced benefit designs.
Anthem pioneered RBB adjudication with several high-profile clients for knee/hip replacements and for advanced imaging. The results have been stunning.
Our Vendor also did pioneering work in reference based benefits, focusing especially on engagement and state-of-art navigation. They are regarded by many as the market leader in the medical shopping experience.
By bringing the Vendor’s engagement & navigation capabilities and Anthem’s networks & servicing capabilities into one integrated experience, we can offer a market-leading RBB plan design.

6. The Value to Clients
Anthem’s RBB model will appeal to employers who want
Superior network value (broadest network, best rates)
Superior servicing
Higher employee engagement
Market leading medical shopping experience
Direct savings from RBB thresholds, either by redirecting services or by imposing the limits.
Savings will depend on factors within the control of the employer, including the number of services impacted by RBB and where the RBB threshold is set for those services.
Savings will grow as more services are impacted by RBB.

7. (PLACEHOLDER SLIDE) Cue up the JellyVision teaser video
Transition to Nita after video

8. Who Is Castlight Health?
25% 7
#57
PhDs in advanced math
and sciences
full-time physicians
CEO ranked in top 100 most creative business execs 90
$181 #1
Product-focused employees
million in capital
WSJ VC-backed company
Our roots

9. RBB: How It Works Wide price variation exists within a region
Price for Neck MRI
$575
$575
$647
$647
$705
$705
$840
$840
$926
$926
$1000
$1000
$1360
$1360
$1510
$1510
$1671
$1671
$2030
$2030
Define Reference Price
If member chooses location below reference price
If member chooses location above reference price
Normal coverage rules apply
Member pays portion above reference price

10. Member goes to Central Hospital
RBB: How It Works
MRI of the Knee
Coverage 20% coinsurance Reference price $500
Member goes to Central Hospital
Total Price $650
Reference Price
Overage
$500
$150
Member Pays: $100 (20%)
Employer Pays: $400 (80%)
Member Pays: $150
Employer Total $400
Member Total $250

11. RBB Can Help You
No Matter Where You Are In Your Benefits Journey, RBB Can Help You Achieve Your Goals
Meet Anne, who leads benefits at a company that:
Offers fairly rich benefits
Wants to maintain benefits, but is struggling to do so as costs rise
Meet Bob, who leads benefits at a company that:
Has already shifted costs considerably
Already has a culture of employee responsibility

12. Value of RBB
Slows growth in trend, with less pushback from employees than limiting provider choices
Keeps benefits the same for employees that stay under the reference price
Begins to instill greater accountability with employees
Enables further savings beyond what traditional high cost sharing plans can achieve
Helps preserve benefits and prevent the need to drop coverage for employees
Reinforces accountability and consumerism of employees

13. RBB Implementation Tailored To Needs
Launch RBB on only a few services to start
Set reference prices high to minimize change
Heavy emphasis on education, teaching employees about the value of making better decisions
Launch RBB on a broad set of services and categories
Set reference prices low to drive behavior change quickly
Heavy emphasis on change management, easing the transition to the new plan

14. Anthem And Castlight Make It Easy
Comprehensive provider network
RBB adjudication expertise and capabilities
Rich data resources
anthem.com integration
Streamlined member support
Best-in-class health care transparency solution
In-depth expertise designing and implementing RBB programs
Comprehensive communications and change management tools
Market-leading engagement tactics and results

15. What To Do If You’re Interested
Contact Your Anthem or Castlight representative today!