1. Independent Long Term Care: Creating Consumer Choice and Cost Savings

2. Problem: Small percent of “high cost” individuals drive nation’s health care costs High-cost Medicaid enrollees (over $25,000 annual spending) are 4% of all enrollees, 49% of all spending 49% are elderly and 43% are disabled. nursing homes or other long-term care represent 77% of cost attributable to elderly “high-cost enrollees” of Medicaid

3. Cost-Savings from Health Care Can Create the Revenue for a New Model 1.Reduced hospitalizations (average price per hospitalization is $18,000) 2.Helping seniors avoid unnecessary nursing home stays ($66k-$95k/year costs) 3. More efficient delivery of community-based services a) IHSS b) Adult Day Health c) Wellness/health promotion services

4. Case Study: Mission Creek Senior Community San Francisco Service-enriched independent living alternative to nursing home beds SF DPH pays $700/month subsidy for exclusive access to units $29,000 per capita annual savings to Medicaid and Medicare

5. Case Study: Mission Creek Senior Community San Francisco Mercy’s on-site team provides a holistic “blended” approach to services and property management Service Coordination Health Interview Health Education Food banks Physical ActivityWell-being Checks Transition PlansBenefits Acquisition SF DPH also provides access to a roving team that can meet the “medical” needs of residents

6. Market Inefficiencies Medicaid will pay for skilled nursing or residential care facilities at three to four times the monthly cost of Mission Creek Medicare will pay 20X the daily cost of Mission Creek for hospital beds for patients that lack a home to be discharged to. Once the patient’s medical needs have been met, hospitals pay the cost of “housing” in their $1,000/night beds

7. Value Proposition: Estimated Total Costs & Savings Net Savings LTC Fee LTC Fee Health care cost $85k-100k per year Health care cost $85k-100k per year Impact of Independen t Long Term Care Pre-Intervention With Independent Long-Term Care Ongoing health cost

8. Factors that influence revenue potential Alignment / Access Control Annual Medicaid Expense Alignment: Degree to which the residents are members, enrollees, patients of the health partner. This is based in part on how access to the building is controlled.