EPIP Fall Conference Banner Pioneer ACO and

1. EPIP Fall Conference Banner Pioneer ACO and Patient-Centered Medical Home/ Alternatives to Admissions & Readmissions Chuck Lehn CEO Banner Health Network 11/4 and 11/5/2013

2. Objectives • Understand the transition of the U.S. healthcare system from a transactional, episodic system to an integrated and continuum-based system • Review the needs of individual, employer, and governmental purchasers of healthcare • Discuss the value-based opportunities for the providers of emergency care within the care continuum • Identify potential barriers to achieving enhanced value in emergency medicine and methods to overcome those barriers

3. Banner Health Snapshot • 23 Acute Care Hospitals • Banner Health Network • Banner Medical Group with more than 900 doctors • Banner Health Centers and Clinics • Behavioral Hospital • Outpatient Surgery • Medical Education • $4.9 billion in revenue, 2012 • AA- bond rating • $395 million in community benefit including $149 million in charity care, 2012

4. Current Healthcare Environment

5. Health Care Spending per Capita & Life Expectancy Source: OECD Health Data, 2007 (data extracted 6.182.10) 5

6. Banner Health Network (BHN) BHN at a Glance 12 Acute Care AZ Facilities Share = 50% Approx. 800 Physicians Share = 13.3% Approx. 900 Physicians Share = 13.3% Approx. 1,000 Physicians Share = 13.3%

7. Overview of Arizona Market

8. Focused on NewValue-Based Models of Care

10. Payer Landscape

11. Provider Readiness

12. Plan, Coordinate, & Manage Care Tools Outcomes Goals ACO 33 Quality/Clinical Outcomes • Disease specific (Diabetes, Cardio, Resp) • Preventive care • Care coordination (all cause readmission, admission for ambulatory sensitive conditions) • Member experience Disease Registry Quality Measure Case Managers Disease Managers Robust reporting tools and dashboards Financial Outcomes • Total medical PMPM

13. Case Management Practice Settings • There is a single, standardized model for Case Management; the setting varies. • A standardized process requires standardized assessment tools, action plans, and workflows. • Supporting programs are developed that support and mimic the standardized approach to case management (IAC and Bundled Payment).

14. Pioneer ACO First-Year Results

15. Banner Health Network Current State Strengths Challenges • Geographic coverage • Integrated payment models • Blend of employed and contracted physicians • Years of experience managing risk • Acute care facility clinical performance • Breadth of medical service capabilities • Culture is built upon acute care • Cultural integration across continuum of care • IT infrastructure across continuum • Funding resources • Balance between volume based and value based models • Beneficiary engagement

16. The True Impact of the Triple Aim

17. BHN - Overall Lessons Learned • New business models ranging from shared savings to joint ventures have developed faster than we anticipated. • Physicians will adapt to accountable care principles if you have specific clinical and financial models to invite them into, such as patient-centered medical home, bundled payments, shared savings, or other mechanisms to align quality, service, and cost goals. • Finance, data infrastructure, and administrative work dominate time and attention during the start-up phase.

18. BHN - Overall Lessons Learned(cont.) • Clinical performance, innovation, and member service are the keys to long term success. We plan to stay focused in these areas. • Identifying specific areas of financial quality or service improvement is a great way to align interests of all parties toward a common goal. • Don’t underestimate the extent to which communication is needed for these relationships to be successful. In-person meetings of any type (formal or informal, large or small) seem to be the most useful method of transmitting information.

19. Questions and Answers