A Consumer Centered Health Plan

1. A Consumer Centered Health Plan

2. Our Vision Mercy Health Plans is an innovative healthmanagement company. We facilitate the effective delivery of healthcare and provide services that empower members to make healthy choices. We are driven by the need to increase access to quality care, provide excellent service and demonstrate significant value to those we serve.

3. The cost of unhealthy behaviors • 30% of US adults --or 60 million people-- 20 years of age and older are obese. • The cost of heart disease and stroke in the US is projected to be $403 billion in 2006. • Cigarette smoking is the leading preventable cause of death in the US, accounting for approximately 1 in every 5 deaths each year. *according to the Centers for Disease Control

4. Health costs: CEOs number one expense challenge A 2005 Kaiser Family Foundation survey of 2,995 employers showed that the average medical plan premium for family coverage is $10,800 a year… …This costs now exceeds the annual pay for a minimum wage employee.

5. Does this sound familiar? • Huge premium increases year after year. • Jumping from insurer to insurer. • Constant adjustments of benefit options to help control healthcare costs. • Unhealthy employees and increased absenteeism.

6. Consumer directed healthcare… Is it the answer? • Key Components: • Reduced benefits • Increased copayments • Cost-shifting to the consumer • The Outcome: • Consumers forgo needed medical care • Harms patients with chronic conditions • Cost of bad behavior is shared by all

7. The Right Solution Instead of shifting costs or blame, we need to shift our thinking… Employees need to view health insurance as contract with mutual responsibilities, NOT just an employer-sponsored benefit.

8. MyChoice is the Solution • It’s designed to engage employees, andemphasize their need to take personal responsibility and accountability for their health and lifestyle choices. • It’s a way for employers to influence better health, while protecting their ability to offer high-quality, smarter health coverage.

9. Why is MyChoice the solution? • It will improve the overall health of an entire member population; • - including those consumers who are not currently at serious risk and are not major drivers of healthcare costs. • Over time, you would be able to systematically reduce the costelement of the healthcare system. • Lower costs, in turn, translate to lower premiums and more affordable coverage for employers.

10. Why it’s a smart choice for employers • Higher productivity and job performance • Lower absenteeism and presenteeism • Improved morale • Lower health care costs • Higher employer job satisfaction and retention

11. How does MyChoice work? Participating employees and covered spouses must: • Be willing to take responsibility for their health • Use a secure web-based Personal Health Record to monitor their progress towards achieving health goals.

12. 3 Steps of Participation Personal Health Record Step One: MyChoice Eligibility Questionnaire Step Two: My Plan for Health Step Three: Health Risk Assessment

13. Eligibility Questionnaire • The employee and spouse must take and pass the eligibility questionnaire by agreeing to follow certain lifestyle behaviors. • The questionnaire is taken yearly during the MyChoice open enrollment period. Question topics include: Seat Belt Usage Tobacco Usage Obesity Blood Pressure Cholesterol Diabetes Preventive Screenings

14. My Plan for Health • A personal plan for health will be generated from your answers to the eligibility questionnaire. • Examples of health activities include cholesterol test, colon cancer screening, tobacco cessation program, and mammography. • Throughout the year, the employee and spouse will login to a secure website and enter the date that the health activity was completed. • Participating employees and spouses will be required to complete these health activities in order to be eligible for the MyChoice benefit plan the following year.

15. Health Risk Assessment (HRA) • The HRA is a health and lifestyle questionnaire. • The answers to these questions form a personalized Health Analysis Report, which includes a good habit score. • Recommendations from the Health Analysis can be used to develop health and wellness goals for the upcoming year.

16. Healthwise Knowledgebase Highlights Access to thousands of topics including: - Health conditions; - Medical tests and procedures; - Medications; and - Everyday health and wellness issues.

17. What’s in it for the employees? • Healthier, more productive lives • A sense of mutual responsibility in their healthcare • Increased benefits • Decreased premiums and copayments

18. MyChoice Benefit Options Option A: Selection based on benefit levels Option B: Selection based on contribution levels Option C: Selection based on both benefit andcontribution levels

19. The correlation between incentives and adoption • The optimal reward amount should be just enough to tip the balance. • Employees must perceive the difference in either benefit or contribution levels to be significant.

20. Results: what is the outcome of using MyChoice? • When members are given the opportunity – with incentives – and the appropriate tools to take responsibility for improving their personal health, they embrace it. • This enables employers to foster a culture that focuses on wellness and rewards employees who get and stay healthy. • Ultimately, healthier employeesspend less on healthcare services.

21. MyChoice Results

22. Keys to your Success • Employer support and accountability • Employee education and responsibility • Incentives in the form of richer benefits and reduced copays

23. Why you can’t afford not to use MyChoice • Shifting costs to employees can hurt employee morale and commitment and will not solve the cost problem. • Poor lifestyles lead to ill health. • Indirect costs of poor health – incidental absence, disability, and presenteeism – can be more costly than medical and drug costs. • Healthy employees (and dependents) consume fewer services and cost the least.

24. The Bottom Line Healthy employees mean more productive employees, a result every employer wants.

25. A Final Thought Employers invest large amounts of money in training, computers, and pay-for-performance to maximize employee output… Shouldn’t employers also invest in the health of their employees to improve both the quality and value of the goods and services they produce?