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The Medtronic CareLink ™ Network (and Heart Failure Device Patients)

The Medtronic CareLink ™ Network (and Heart Failure Device Patients). Presented By: Will Au-Yeung John Curtis Susan Malaret. Agenda. Converging Forces Increasing Heart Disease Industry & IT Trends CareLink Technology Reference Case Cost Effectiveness Discussion.

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The Medtronic CareLink ™ Network (and Heart Failure Device Patients)

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  1. The Medtronic CareLink™ Network(and Heart Failure Device Patients) Presented By: Will Au-Yeung John Curtis Susan Malaret 6/10/2014 MEDTRONIC CONFIDENTIAL 1

  2. Agenda • Converging Forces • Increasing Heart Disease • Industry & IT Trends • CareLink Technology • Reference Case • Cost Effectiveness Discussion 6/10/2014 - page 2

  3. Advancing technology creates opportunity Increasing Life Expectancy & Heart Failure Macro-Trends Industry Trends CareLink 6/10/2014 - page 3

  4. What is Heart Failure? • Heart Failure is NOT a heart attack! • Heart failure is a condition that develops when the heart’s muscle becomes weakened after it is injured from something like a heart attack or high blood pressure, and loses its ability to pump enough blood to supply the body’s needs. • Effect on Body • Not enough blood circulating • “Congestion” or fluid build up 6/10/2014 - page 5

  5. Heart Failure Prevalence • 4.8 million Americans suffer from congestive heart failure • 250,000 deaths each year caused by heart failure • 500,000 new cases diagnosed each year, expected to double within 5 years • Americans have a 1 in 5 lifetime risk of developing this condition Source: National Health and Nutrition Examination Survey 6/10/2014 - page 6

  6. Heart Failure Occurs in Old Age Percentage of total population by age group 6/10/2014 - page 7

  7. Heart Failure Costs • $40 billion is spent each year in managing heart failure* • Hospital charges for heart failure management were approximately $10,000 per discharge, based on a mean length of stay of 6.3 to 7.7 days.** • HF patients average 3.4 office visits per year, at a cost of $13 billion** • Average cost per office visit- approximately $800/visit. *Medtronic website **O’Connell, JB, “The Economic Burden of Hearth Failure,” Clinical Cardiology, 2000. 6/10/2014 - page 8

  8. Quickly Approaching Capacity Constraints 1500 Device patients 1250 The number of cardiac device patients is expected to soon exceed clinics’ capacity 1000 750 Patients 500 250 clinic capacity 0 1998 2000 2002 2004 2006 2008 • Implantible cardiac defibrillators (ICDs) are increasingly used for heart failure therapy. 6/10/2014 - page 9

  9. Industry Macro-trends • Patients demand: • Greater responsibility for managing their health • Convenient and consistent care delivery • Increased family involvement • Clinics face: • Escalating volumes • Pressures for time, ROI, staff recruitment/retention • Disruption to continuity of care 6/10/2014 - page 10

  10. Device Follow-Up: Today Total Time: 20-30 minutes • Nurse/Technician • Escorts patient to room • Inquires about meds, • Receptionist • Greets patient • Collects co-pay, if applicable • Nurse/Technician • Interrogates device and checks thresholds when appropriate • Admin/Technician • Pulls schedule and patient file 4 1 2 3 10-15 mins • Administration • Billing submitted • Reimbursement filed • Receptionist • Schedules next appointment • Doctor • Over-reads paperwork • Nurse/Technician • Completes paperwork • Doctor • Sees patient if necessary 9 8 5 7 6 5 mins 5 mins 6/10/2014 - page 11

  11. 1 Patient holds the antenna over her device for interrogation. The Monitor automatically dials a toll-free number and transmits the data over a standard phone line. 3 Clinic can view patient data and reports on a secure website 4 2 Patients and their families can access extensive materials about living with their ICD Data is automatically sent to a secure server Solution:Medtronic CareLink Network 6/10/2014 - page 13

  12. Medtronic CareLink™ Monitor Portable device used by patients to send data • Routine follow-up • Symptomatic episodes • Post-shock events A standard telephone line is the only requirement • Connect from home or while traveling (within the United States) Medtronic CareLinkMonitor 6/10/2014 - page 14

  13. Clinician Website • Interrogation capabilities comparable to in-office follow-up • All vital information provided in familiar, easy-to-read format • Review information any time, anywhere • Connect using personal computer with standard Internet access 6/10/2014 - page 15

  14. Sort by date/time, patient name, and physician • Allows quick triage of patients, based on alerts • Detailed information on patients or transmissions is one click away Patient list • The first screen the clinician sees upon entering the CareLink Clinician site 6/10/2014 - page 16

  15. Quick Look™ • All vital device information provided in a familiar, easy-to-read format • Comparable to the Medtronic programmer 6/10/2014 - page 17

  16. Determine appropriate sensing and pacing characteristics Patient’s presenting rhythm is captured at time of transmission 10 Second EGM 6/10/2014 - page 18

  17. Cardiac Compass Report • One of the most important patient monitoring tools • Same format as the Programmer • Can be viewed on-screen first and then printed on 8 ½” x 11” paper 6/10/2014 - page 19

  18. Nurse/Technician • Checks device and completes paperwork • Administration • Paperwork to Billing • Billing submits claim • Admin/Technician • Pulls patient file • Prints Reports • Schedules next appointment • Doctor • Over-reads paperwork 2 4 3 1 Workflow with CareLink Total Time: 4-8 minutes 4 mins 3 mins 6/10/2014 - page 20

  19. Medtronic CareLink The solution. ICD Follow-up Clinic Example Medtronic ICD Follow-up Example • The Medtronic • CareLink Solution: • Increases the number of patients clinics can see today without investing in new staff or facilities • Limit staff and facility investments tomorrow 6/10/2014 - page 21

  20. Cost Effectiveness 6/10/2014 - page 22

  21. Cost Effectiveness (Cost of intervention – costs averted by intervention) Cost Effectiveness = Benefits of intervention 6/10/2014 - page 23

  22. Cost Effectiveness Costs of Intervention By Payor: • Reimbursed same as office visit By Provider: • Medtronic bills monthly fee based on number of patients enrolled (about $17.50 per patient, per month) • Cost of nurse, technician, and/or physician to review reports • Some training required By Patients: • No fee to Medtronic for monitor or basic patient website access • Patient co-pays are equivalent to in-office visit • Some training required 6/10/2014 - page 24

  23. Cost Effectiveness Costs averted by intervention For clinics: • Reduced cycle time for follow-up visit- “5 minute check vs. 20 min check.” By patients: • Transportation costs and lost time 6/10/2014 - page 25

  24. Cost Effectiveness Costs averted include transportation time for patients and reduced cycle time for follow-up checks for clinics. Current Follow-up Work flow: • Nurse/Technician • Interrogates device and checks thresholds when appropriate • Receptionist • Greets patient • Collects co-pay, if applicable • Nurse/Technician • Escorts patient to room • Inquires about meds, • Admin/Technician • Pulls schedule and patient file 10-15 mins • Administration • Billing submitted • Reimbursement filed • Receptionist • Schedules next appointment • Doctor • Over-reads paperwork • Nurse/Technician • Completes paperwork • Doctor • Sees patient if necessary 10 mins Total Time: 20-30 minutes 6/10/2014 - page 26

  25. Cost Effectiveness Work flow with CareLink: • Nurse/Technician • Checks device and completes paperwork • Admin/Technician • Pulls patient file • Prints Reports • Schedules next appointment • Doctor • Over-reads paperwork • Administration • Paperwork to Billing • Billing submits claim 3 mins 4 mins Total Time: 4-8 minutes Time savings with CareLink: 12-26 minutes 6/10/2014 - page 27

  26. Cost Effectiveness Benefits of Intervention Clinic Benefits: • Better patient care: Allows continuity of care, which may lead to improved patient compliance and satisfaction. • Improved access to patient data: Comprehensive device data and patient diagnostics are available when and where needed. • Improved clinic operations: Current clinic customers report being able to dramatically decrease the time for each device check. Patient Benefits: • Convenience: routine device checks can be done from the convenience of the patient’s home. • Freedom to travel: patients can transmit data from anywhere in the 50 states • Peace of Mind: patients and their families have peace of mind by being remotely connected to clinics. 6/10/2014 - page 28

  27. Cost Effectiveness Total Cost Effectiveness Net costs of intervention: • Increased cost to clinic for CareLink service approx. $210 per patient per year. CareLink reader provided to patient free of charge. • No net change for equipment at clinic. • Cost savings from decreased cycle time potentially $400 per visit, or $1360 per patient per year based on 3.4 visits per year. • Net savings potentially $1150 per patient per year. Change in Quality Adjusted Life Years (QALY’s) • Undetermined: net change in health status likely to be negligible due to equivalence to office visit. • Potential gains: decrease in disease affecting work and social activities due to travel time to office visits. • Potential losses: increased complexity of care. Potentially cost saving, but more studies need to be completed. 6/10/2014 - page 29

  28. Cost Effectiveness Effectiveness of Similar Technologies “Preliminary findings suggest that using this technology would result in an annual savings of $515 per patient and a 26% reduction in Medicare costs. Investigators also postulate that if all 500,000 Americans with pacemakers switch to remote monitoring, the technology could save Medicare $210 million a year in direct healthcare costs.” Quality, Patient Safety & Cost Effectiveness through Leadership and Health Information Technology “The benefits of eHealth enabled chronic care have been established by leading health care institutions including the Dept. of Veterans Affairs, which recently published results from over 2 years of demonstration projects showing 63% reduction in hospital admissions and a significant improvement in quality of life. “Published results from studies involving over 1000 patients with HF, diabetes and chronic respiratory disease- showed a 40% reduction in emergency room visits, 63% reduction in hospital admissions, 60% reduction in hospital bed days of care….and significant improvement in quality of life. Remote monitoring of ICDs July 2003 by National Horizon Scanning Centre. Cost effectiveness study carried out in France- A follow-up cost for non home monitoring patients was compared to the expected follow-up cost of patients with home monitoring of ICDs. For each visit, the cost for transportation was $128 US and medical costs were $94 leading to a total cost of $222. Over 5 years, the reduction in costs for follow-up visits was estimated at $2,200 if the number of visits is reduced from 4 to 2 and $3,300 if reduced to 1 visit per year. Healthcare:Harness the Power of the Internet e-Commerce and e-Care by Douglas E. Goldstein, Aspen Publishers 6/10/2014 - page 30

  29. Reimbursement - Existing Codes • CMS Carrier (WPS) Medical Director has agreed to allow use of existing codes • Use codes • 93741 • Single-chamber ICD check without reprogramming • 93743 • Dual-chamber ICD check without reprogramming • No additional paperwork require • Approximate Medicare reimbursement in Chicago/Illinois = $75 - $85 6/10/2014 - page 31

  30. Reimbursement 6/10/2014 - page 32

  31. Conclusions • Cost effectiveness of telemedicine is hard to prove • Claims data is minimally useful • Uses current codes- difficult to differentiate from reference case • Patients are sick! A lot of comorbidities. • Cost-savings for provider is not clear • Time savings? Prevention of hospitalization and follow-ups? • Patient Benefit is Unclear • Convenient but does it impact the QOL score? • Further Study • Clinical studies to identify any changes in QALYs • Verification of decreases in cycle time and associated costs. 6/10/2014 - page 33

  32. Questions? 6/10/2014 - page 34

  33. The Future of Follow-Up Care • Cardiac patients send comprehensive device data from the comfort of their homes. • Electrophysiologists view and analyze data using the Internet. • Patients may view an educational website designed exclusively for them. • Referral physicians benefit from timely feedback from the EP about the patient’s condition. 6/10/2014 - page 35

  34. The Numbers… Patient Prevalence (000’s) Only 34% of VT/VF patients indicated for ICD therapy receive the device today* *Ruskin, N. J Cardiovascular Electrophysiology, 2002;13:38-43. **1) AHA 2002 Heart and Stroke Statistical Update. Dallas, Tex.: AHA 2001. 2) Brehens, S. PACE. 2002;25:545. 3) Reek S et al. PACE. 2002;24:527. *** Abraham W, Fisher W, Smith A, et al. N Engl J Med. 2002;346:1845-1853. 6/10/2014 - page 36

  35. ICD Follow-up Clinic Example 1500 Fact: Device patients 1250 The number of cardiac device patients is expected to soon exceed clinics’ capacity 1000 The number of patients indicated for ICD therapy has doubled.* 750 Patients 500 250 clinic capacity 0 1998 2000 2002 2004 2006 2008 A growing population * ACC/AHA/NASPE 2002 guideline update. 6/10/2014 - page 37

  36. Impact to Your Clinic 6/10/2014 MEDTRONIC CONFIDENTIAL 38

  37. Patient Adoption 6/10/2014 MEDTRONIC CONFIDENTIAL 39

  38. Convenience: Routine device checks can be done from the convenience of the patient’s home. Patients can transmit data when they travel within all 50 states (USA only). Patients and their families have peace of mind by being remotely connected to the clinic. Freedom to travel: Peace of mind: Patient benefits 6/10/2014 - page 40

  39. Reimbursement 6/10/2014 MEDTRONIC CONFIDENTIAL 41

  40. NASPE Consensus and Guidelinesfor Regular ICD Evaluations • One-to-four month intervals • More frequently if • ICD therapy occurs in absence of premonitory symptoms • To ensure no false sensing or breach of electrode integrity has occurred • As battery end-of-life approaches 6/10/2014 - page 42

  41. Pricing and Billing 6/10/2014 MEDTRONIC CONFIDENTIAL 43

  42. Pricing • For clinics • Monthly fee based on number of patients enrolled (~$17.50 pppm) • No up-front fees; 30-day notice to terminate • Invoiced per patient per quarter • SignUp! Program applies with 10 or more patients per quarter • For patients • No fee to Medtronic for monitor or basic patient website access • Patient co-pays equivalent to in-office visit 6/10/2014 - page 44

  43. Clinic Fee Supports Many Services • Clinician Website • Monitor (shipping, storage, and replacement) • System Maintenance • System Updates • Data Storage • Security • Unlimited Clinic Users • Implementation Support (including materials, training, etc.) • Technical Support • Account Management 6/10/2014 - page 45

  44. Sign up. Enroll patients. Save. • Enroll 10 or more patients on the Medtronic CareLink Network in a calendar quarter and receive a rebate---resulting in savings of approximately 25% • Introducing… 6/10/2014 - page 46

  45. CareLink Network Economic Advantages • Snowbirds • Episode Patients who go to the ER • Referrals and Outreach • Marketing Leadership • Time – Reallocate to Higher Value Activities • Potential Savings in Satellite Expenses 6/10/2014 - page 47

  46. Why clinics buy CareLink: • Low Risk Business Model and Contract • No upfront costs – unlimited users – complete service • Upgradeable to new technology • 30 day anytime out of the contract • Maintain current reimbursement • CareLink is cash flow neutral • Not a cherished revenue/profit center (non-material) • Perceived Value of Technology • Technology is a new option to manage clinic growth • CL competes well with current cost of running a clinic • Improve workflow – “The 5 minute Check vs. the 20 minute check”. • “Patients are asking for CareLink”. 6/10/2014 - page 48

  47. Implementation and Account Management 6/10/2014 MEDTRONIC CONFIDENTIAL 49

  48. Medtronic Patient Management Provides Comprehensive Account Management • Implementation and Ongoing Service • Partner with Customer to Achieve CareLink Objectives • Best Practice Development and Sharing • Respond to Service Requests and Information Needs • Represent Customer in Product Enhancement Planning “Our Goal: Customer Satisfaction and Retention” 6/10/2014 - page 50

  49. Medtronic CareLink Network Questions???? 6/10/2014 - page 51

  50. 6/10/2014 - page 52

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