1. © 2008 A. Milstein Arnold Milstein, MD, MPH Mercer Health & Benefits Pacific Business Group on Health Employer Leadership in Incubating a 60 MPG U.S. Health Care System September 16, 2008

2. © 2008 A. Milstein For the Dorsetts to Afford Coverage and a Continual Inflow of Medical Miracles, U.S. Clinicians Must… Translational Efficiency Lower total cost of care by ~ 35 percentage points by meeting “top quadrant” quality-cost benchmarks Knowledge Turns Lower total cost of care by >2.5 real percentage points every year thereafter and improve quality (See Andy Grove’s ’05 JAMA article)

3. © 2008 A. Milstein How Do Today’s Most “Fuel-Efficient” Clinicians in Top Quadrant Minimize (A) Health Crises/Year and (B) Cost/Contact? Salient Caring With Outreach Between Visits Lean Production of Service Units Tight Mgmt of MD Specialists ( Crises) ( Cost/Contact) ( Both)

4. © 2008 A. Milstein Employer Paths to 60 MPG Care 1. Leading Employers: Via tiered MD networks and/or shared savings with MDs, create a market that encourages MD adoption of benchmark care delivery methods 2. Leading Edge Employers: Incubate MD discovery of benchmark care delivery methods, starting with primary care AerospaceGamingRetail