REDESIGNING CARE FOR THOSE WHO NEED IT MOST…

1. REDESIGNING CARE FOR THOSE WHO NEED IT MOST…

2. Our Mission • To address the complex problems of aging while protecting the precious financial resources of our members and the federal government.

3. A Deployable Model Wrapped in Health Plan Our Markets Modesto 3,828 2013 Expansion Nevada Richmond Virginia San Jose 3,425 California Las Vegas 3,852 Riverside875 Arizona San Bernardino 3,328 LA/OC 38,035 Phoenix3,849 Tucson 8,682 Source: Management estimates for membership for the year ending 12/31/11 CONFIDENTIAL MATERIAL

4. Our Philosophy of Health Care • Older patients require overtly coordinated care with a care path that takes into account their multiple conditions and treats them simultaneously • A physical and human locus of care is required to create care coordination and a setting where care habits of patients can be sustained. • Clinicians in key roles must be confident generalists, persistent and deliberate, with competence as clinical decision makers, communicators and team players. • All providers of service have a buy-in for the system of care, not just their individual capabilities. • A complete care continuum requires equal attention to medical, social, psychological and pharmacologicalneeds of the patient. • An explicit approach to care is required for each chronic condition, for high-frequency acute episodes, and for end-of-life. • An obsessive attention to detail in both micro matters (individual care) and macro matters (care programs) permits optimal outcomes • A willingness to thoughtfully challenge the status quo provides windows of insight into clinical innovation and care pattern redesign which can optimize patient health and comfort, and conserve financial resources.

5. Challenging the Status Quo • Health care systems should be about improving quality, not maintaining it • At least 35% of health care costs for the chronically ill can be avoided • Prepayment (Capitation) is freedom, not risk • Primary Care is a “team sport” not an “individual sport” • For aging adults, Primary Care should be an outbound activity, not an inbound activity • A high percentage of physician services can be provided by non-physician clinicians • Benefit design should lead with patient access and compliance considerations, not actuarial risk considerations • Patient compliance is more our problem than the patient’s • We have a responsibility for the financial well-being of our physician and hospital partners • Many patients fare better with less complex health care interventions

6. The CareMore Model

7. Healthcare cost and quality problems are concentrated….not widespread 85% of Beneficiaries = 25% Spending 15% of Beneficiaries = 75% Spending ESRD, CANCER 7 Million Beneficiaries- Spending $55,000 each- Total Spending = 75% ($391 B) 23 Million Beneficiaries- Spending $1,130 each- Total Spending = 5% ($26 B) 16.1 Million Beneficiaries- Spending $6,150 each- Total Spending = 20% ($104 B) CHF, DM AverageSpending Healthy Stable Sick Sickest mostly 1 + Chronic Illness mostly 3 + Chronic Illness 2010 MedicareSpending Projection = $522 B46 Million BeneficiariesSpending Per Beneficiary = $11,347 Progressive Illness

8. CareMore’s system functions in parallel with community physicians Non-Frail Population Frail & Chronically Ill Population CareMore Care Centers Primary Care Physicians CareMore Care Centers Extensivists Primary Care Physicians CareMoreExtensivist Provider Relations Member Services Case Managers Home Based Services Continuous Frailty Assessment Tools Specialists • Close monitoring of non-frail members to proactively identify at-risk members and aggressive management of chronic conditions to prolong the onset of frailty • Intensive management of frail and chronically ill members, identified through predictive models, data scans, PCP referrals or member self-identification

9. The essentials of CareMore’s model Predictive Modeling & Early Intervention Chronic Care Management Acute CareManagement Operating Principles Redefining Primary Care • Clinical Control - CareMore extensivists determine when a patient requires proprietary services and programs • Speedy Deployment - Proprietary services and programs can be deployed within minutes • Efficient Allocation of Clinical Resources - The model replaces physician labor with skilled, allied health professionals such as NPs, MAs, therapists and dieticians • Early Intervention - Proprietary resources and predictive modeling allow for early intervention to prevent acute episodes Secondary Prevention Redefined Acute Care Episode

10. CareMore solution – new model of care COPD CAD Diabetes CHF Wound Clinic Chronic Disease Support Healthy Start ESRD Monitoring Hospice Secondary Prevention End of Life Care PCP Extensivist Nutritionist Palliative Care Foot care Risk Event Prevention Social / Behavioral Support ClinicalCare Centers(CCC) Case Manager/ NP Social Workers Exercise Pre-Op Mental Health Frailty Support Coumadin Extensivist Management Fall Strength Training Predictivemodeling Integrated IT infrastructure Longitudinal patient record Evidence-based protocols Point-of-care decision support

11. Results of the CareMore Model

12. Primary care physician value proposition Increase PCP Compensation • Medicare FFS pays the PCP $67 per visit (CPT code 99213) -- an average of $480 patient / year (assuming 7.2 patient visits a year) • CareMore guarantees the PCP $480 ($40 PMPM) but visits are only 4.5 per year and we pay $107 per visit Increases PCP Schedule Capacity • CareMore clinicians and programs relieve PCPs of their most complex chronically ill and frail patients • Increases PCP capacity by 20% to 30% -- can add more patients to increase pay Better Patient Care • More resources used to support the PCP funded by CareMore prepayment • CareMore programs provide the PCP with resources that enable better clinical care • Preventive care programs • Medical Home (CCC) • Chronic programs • Technology • Communications tools • Unique PCP value proposition has served CareMore well in new markets

13. The CareMore model produces dramatically improved outcomes for several costly chronic diseases and conditions Diabetes ESRD CHF Status quo Status quo Status quo Half of all ESRD Admissions were the result of either poor hygiene, poor diabetic control or vascular access limits/clogs. Dialysis centers provided no primary care and patients were referred to the ER. Most ER visits resulted in an admission Many patients with out-of-control diabetes were not brought in control through insulin use. Common wisdom was that inability to correctly self administer or improper dosing were driving results. Further, insufficient support in the areas of nutrition and exercise were observed PCPs were not collecting daily weights, a leading indicator of change of condition. Self-reported weights were inaccurate. PCPs were not adequately responsive to immediate care needs of patients who require intervention within a few hours of onset of symptoms CareMore Redesign CareMore Redesign CareMore Redesign Established insulin “starts” and insulin “camps”. At the “start” day, patient is trained in all aspects of self-administration of insulin. At “camps”, patients are brought to the center for a full day to observe all of their behaviors and monitor glucose levels at all points of self care. A personal nutrition counselor was assigned Equip each patient with a wireless scale that sets off alerts if weight gain is 3 lbs overnight or 1 lb per day for more than 3 days. Same-day visit with clinician if alert is triggered. Proactive hospice planning with changes in condition Established a dedicated case manager and nurse-practitioner who receive referrals from centers in lieu of ER referral. Primary/preventive care is provided and all patients are in the diabetic management program, receiving monthly preventive access line inspection and, if needed, cleaning Result Result Result • Average HbA1c for those attending our diabetic clinic is 7.08, with 7.0 being considered good control. Patients in the clinic are referred for poor control • 50% reduction in hospital admission rate in 5 months • 42% fewer admissions than the national average • 56% reduction in hospital admission rate in 3 months

14. The CareMore model produces dramatically improved outcomes for several costly chronic diseases and conditions (cont’d) Stroke Prevention Amputations Depression System Failure System Failure System Failure 70% of hypertensive patients do not have adequate blood pressure control. This leads to increased stroke (and other cardiovascular) risk. Blood pressures checked in PCP offices frequently are inaccurate. PCPs have inadequate time/resources to deal with diabetic wounds, which results in specialty (surgical) referrals that delay treatment, increases cost and increases chance of amputations. Depression is a underdiagnosed problem in seniors. Underdiagnosed depression leads to a variety of health problems and costs including ER visits & unnecessary tests. CareMore Redesign CareMore Redesign CareMore Redesign Equipped patients with labile HTN with wireless blood pressure cuff. CareMore NPs monitor blood pressure & make appropriate changes according to JNC guideline. All new CareMore members receive a comprehensive health exam that includes PHQ-9 & dementia screen. Designed a wound clinic, staffed with wound-certified CareMore NPs. Result Result Result • 48% of patients had >10mmHgs drop in blood pressure • Patients with SBP>160 or higher had average SBP drop of 23 mmHg • Patients with SBP b/n 150-160 had average SBP drop of 19mmHg • Diabetic amputation rate for CareMore members is 60% lower than the national average. • Early diagnosis and then intervention at CareMore’s mental health centers • (19% of screened)

15. The CareMore model produces dramatically improved clinical outcomes for several costly chronic diseases and conditions (cont’d) Wounds Institutional CIT1 Status quo Status quo Status quo Inactivity and some staffing issues (one monthly visit/60 days), lack of primary care in facilities resulted in wound development or exacerbation (for example bed sores) Patients in institutional settings were being hospitalized at a rate of 5x the general populations for untreatable conditions, largely because nursing homes do not have skilled clinical staff to make timely interventions A small fraction of the Medicare population are hospitalized >10 times per year because of lack of home-based or social support resulting in falls, malnutrition, dehydration. Most live alone and suffer from dementia or other mental illnesses CareMore Redesign CareMore Redesign CareMore Redesign Deployed nurse practitioner teams to nursing homes weekly to proactively tend to skin or create early intervention in patients likely to develop wounds CareMore sends a nurse practitioner to the nursing home once a week to keep patients stabilized. If an acute event emerges, an NP is available 24x7 for telephonic consultation and in-person visits if needed CareMore assembled a team of clinical social workers, mental health professionals, lawyers, physicians and NPs who assume a home-based multi-disciplinary care approach for these patients Result Result Result • The usual rate per year for development of pressure ulcers for nursing home patients in California is 13% Only 4% of CareMore’s institutionalized patients developed pressure ulcers • Preventive intervention resulted in reduction in bedsores and reduction in falls. Hospital admission rates are 80% less than national norms • Reduced hospital and SNF admissions by 60%. Resulted in placement rate of >30% for participants 1CareMore Intervention Team, which includes the Company’s expert team of providers

16. Sharing the CareMore Model

17. Presbyterian Community Hospital (Whittier CA) Experiment • 10-Year Contract • Joint Steering Committee Physician Services Hospital Services Market Branding MA License & Marketing Chronic Care Infrastructure Existing Membership PCP Capitation Variable-Cost Based Hospital per Diem All else actual cost • Results sharing with hospital and physicians Lowest Medicare Variable Cost Reduction in Surgical Complication Lowest rate of Death-in-Hospital 4% better readmission rate 7 minute response-time

18. CareMore Supplies the Architecture to Succeed in Risk Based Environment

19. Partnering, Sharing the CareMore Model Training CareMore Inside Reporting Predictive Modeling Clinical Protocols • Transference of care delivery competency • Provide enabling infrastructure • Share in HCC savings Patient Care Risk Coding Case Mgmt Data Integration Payment Models Quality Initiatives Analytics Disease Mgmt CareMore Essentials CareMore • Direct care delivery • High risk populations • HCC savings accrue to client • Fee-based structure

20. Realizing Value From Your Integration Journey • Vision of Improving the Health of Your Communities • Proactive and Targeted Population Health Initiatives • Turning a Health Improvement into an Accretive Event • Seeing Capitation as Freedom, Not Just Risk • Imagine a Delivery System that Creates Value From: • Better Management of Chronic Conditions • Better Quality of Life for Your Frail Aged Community • Better/Safer Care • Rethinking How You Measure Market Share • % of Volume? • % of Population Under Your Care?