Healthy , Wealthy and Wise

1. Healthy, Wealthy and Wise Successful strategies leading to improved retention, engagement and productivity of employees

2. JAX Per Capita Health Claims Cost 2006-2013

3. 2013 vs. 2007 Per Capita

4. Medical Risk Factors 2009-2012

5. Population Risk

6. HMRC Wellness Score 2012 & 13 2012 2013

7. Workers Compensation & Safety

8. How Did We Do It? Where did we go wrong? What did we know for sure? What are the manageable and unmanagible risks? What are the costs and consequences of those risks?

9. Where Did We Go Wrong? • Ignorance and avoidance • Unclear/undefined strategy • Lack of strong leaders • Lack of Plan and Business Model • Lack of visionaries/dreamers • Unclear/undefined accountability • Time • Funds and resources • Lack of fortitude

10. What Did We Know For Sure? The Lower the Risks…..The Lower the Costs % Of Population Source: Aetna

11. What Do We Know For Sure • Risks exist and result in losses • Many risks can be eliminated • All losses can be managed and reduced • Best practices strategies are effective • Waiting prolongs losses and delays results • Employees are our most important assets. Invest in their care, at least as much as we invest in caring for our other assets

12. What are the Risks? • Lifestyle Driven Chronic Disease • Age Driven Impairments – Aging Workforce • Sickness & Degenerative Disease • Genetic Disorders • Environmental Risks • Unsafe Behaviors • Accidents & Injuries • Health Care Utilization

13. What are the Consequences of Risk • Death • Disability • Accidents • Need for Medical Care • Absenteeism • Reduced Productivity • A massive deterioration of our most important assets • All costs associated with these

14. Productivity Losses • Productivity assumes a present, healthy and committed workforce • “Absenteeism” and “Presenteeism” are behaviors • Incidental absences account for 80% of absence events and 33% of lost work days • Employers spend 15% of payroll on absences.

15. Productivity Losses • Every day 3-6% of workforce absent • Companies commonly overstaff by 10% - 20% to cover absences • Typical companies set aside 4.4% of total budget for absenteeism. Poor morale companies set aside 5.5%

16. Presenteeism • Presenteeism is the degree to which a worker is unimpaired and working up to potential • 60% of the total cost of illnesses results from employees who continue to work despite their illnesses and impairments

17. Eliminating Risks • Controllable • Behavior • Resources • Process • Limited Control • Provider Quality • Macro Economics • Macro Health Care Industry • External Cultures

18. Population Risk Management • By Severity of Risk (Predictive Modeling) • By Disease State • By Medical Provider • By Cost • By Location • By Employee or Dependent Risks need to be organized into categories that facilitate development of targeted strategies. Risks can be organized and stratified:

19. Severity Based StrategiesEngaging Employees Where They Are At 15% Members = 85% Cost 85% Members = 15% Cost

20. Risk Management Strategy • A written Health and Fitness Policy is established and signed by leadership • Goals that address health risks and costs are established annually • A written action plan is in place. Timelines and accountability are established • Leadership and local management actively participate in programs and initiatives

21. Risk Management Strategy • Increase management capability and accountability • Develop organization culture • Engage employees and assign accountability • Acquire and manage resources • Manage, measure, improve

22. Health Risk Management Operations Leadership and Management • Health and fitness issues are regularly included on operational meeting agendas • Local site management knows their facilities’ health, disability and absence costs and loss trends. They are held accountable for improvement in each of these areas. • Health and Fitness program success is an element of managers’ and supervisors’ performance evaluation

23. Maine’s Health Care Challenges

24. Why is Health Care So Costly in ME? • Rural older population • Low per capita Income • Poor health status with high rates of chronic disease • Significant cost shifting: • Uncompensated care for the uninsured. • Inadequate government reimbursement. • Highest % of population on Medicare and Medicaid High incidence of Cancer Rising demand for services Inconsistent quality Poor information Inefficient costly care for the uninsured

25. Inefficient: Costly Care for Those Who are Uninsured Individuals who are uninsured still receive medical care, but pay for their care out of pocket, or receive uncompensated (“charity”) care from facilities. Because health care costs are borne out of pocket, the uninsured are less likely to receive preventive services, and delay seeking care until advanced stages of illness. This “inefficient” way of addressing health needs and increases the cost of care.

26. Cost shifting: Inadequate Government Reimbursement • The Maine Hospital Association estimates that for every dollar spent rendering care to Medicare beneficiaries, hospitals receive $0.85 in reimbursement. • The Maine Hospital Association estimates that for every dollar spent rendering care to Medicaid beneficiaries, hospitals receive $0.76 in reimbursement. • These shortfalls contribute to higher insurance costs for other recipients through cost-shifting i.e. employers etc.

27. The Maine Lifestyle (what we perceive)

28. The Maine Lifestyle (reality) Mainer’s health behaviors and lifestyles drive the high cost of care. Maine incidence of smoking, poor nutrition, and inactivity above national average. • 55% of adults are overweight • 38% of teens and 76% of adults do not exercise • Tobacco addiction is above national average • High school substance abuse rate is higher than national average

29. Pre 2007 Strategy Increase cost sharing with employees Incent and cover prevention Telephonic Chronic Disease Management Complex Case Management EAP Aetna Networks “Wellness”

30. Post 2007: What Has JAX Done To Combat These Challenges? • Joined Maine Health Management Coalition (MHMC) and became part of the solution • Reengineered Wellness Plan to JAXfit • Innovative benefit design • Tiered networks • Providers of Distinction (POD) • Value based purchasing • Partner with regional health providers • St. Joseph occupational and non occupational care on site • Enlightened Consumerism

31. Maine Health Management Coalition The Maine Health Management Coalition (MHMC) is a non-profit organization whose over 60 members include public and private employers, hospitals, and health plans. MHMC employers represent 93,000 Maine employees and 110,000 family members of those employees. Participation helped us compare our health care results with coalition members. In 2008 we found our costs were 25% higher per capita compared to MHMC average. First time we had a good Maine based comparison. We found high costs were being driven by the high cost of the three hospitals we used (MDIH,MCMH,EMHS). JAX Per capita hospital costs were 50% higher than coalition average. Became fully engaged with MHMC and worked to be a part of a multi stakeholder solution to state wide problem.

32. 2007 Prevalence and Cost Comparison to MHMC

33. Maine Health Management Coalition • Multi Stakeholder Membership • Quality, Cost, Access • Transparency & Public Reporting • Plan Sponsor Engagement • Consumer Engagement • Payment Reforms • Value-Based Purchasing

34. Providers of Distinction Tiered networks and benefits

35. Providers of Distinction • St. Joseph Hospital (SJH) • St. Mary’s Hospital - knee and hip replacements • Cost for replacements paid at 100% • 100% of travel, food and lodging reimbursed

36. Providers of Distinction cont. • Center for Connected Health Partners Online Specialty Consultations • Harvard Medical School Faculty and Senior Attending Physicians • Expertise from Mass General, Brigham and Women’s, Dana Farber Hospitals • Web based interaction between 2nd opinion specialist, treating physician and patient • 90% of interactions recommend changes in treatments and 5% new diagnosis • 100% covered • Quest Diagnostics • Draw sites at JAX, Ellsworth, Bangor, CT and CA • Lab tests paid at 100%

37. WellMatchis an online health transparency tool accessed via computer, smartphone, or tablet • Find a provider, by location, quality, or cost • View prices for different providers, side by side • Read reviews of providers from co-workers, and write new reviews • View benefits information and total spending-to-date WellMatch, A Healthagen Business | Confidential and Proprietary

38. Transparency-Empowered Health Care Consumers Hospital A: Hernia repair (Inguinal Herniorrhaphy) Hospital B:Hernia repair (Inguinal Herniorrhaphy)

39. JAXfit Engages and empowers employees to: Improve fitness and health Prevent problems before they occur Better handle problems when they occur Detect and act upon problems as early as possible Reduce the severity of problems that may occur Improve health care and medical outcomes Make the best use of available resources Improve the quality of their lives

40. JAXfit cont. • Doug Coleman Fitness Center • Partnership with UMO • Onsite fitness classes • Passport to Better Health/Health Incentive Credits • Spouses invited to participate • Incentives and Rewards • Biometrics/Health Risk Assessments • Prevention • On Site Chronic Disease Management Nurses • On Site Lifestyle Coaching

41. JAXfit cont. • Health Incentive Credit program • Can be used to eliminate health plan deductible • Unused credits roll over from year to year • The following opportunities to earn credits are offered to employees and spouses:(“each” equals employee and spouse) • HRA completion $300/each • Biometric screening $500/each • Lifestyle coaching $400/Each • Person health record Interaction` $100/each • Use of preventative services $200/each • Dental exams $100/each • Retirement contribution $100/each • RN disease management program $600/each

42. 2014 R&D Initiatives TeleDoc or local 24/7 care E-visits with PCP Newtopia Well Match Accountable Care Organizations

43. Controlling Health Risks Conclusion • Health risk management broadens health cost control beyond managing health benefit costs to managing the total cost of risk

44. Questions